Photo credit: Flickr / Matt Kieffer
The U.S. air traffic control system’s limits are on display this summer with airline after airline citing the organization as being among the top constraints to adding back flights as they recover from the pandemic.
Spirit Airlines was the latest to pile on Wednesday when its executives cited limits at the Federal Aviation Administration’s Jacksonville air traffic control center — already known to have staffing issues — as forcing it to fly as much as 10 points less capacity to Florida than it otherwise wanted in the June quarter. That, along with its own staffing issues and other supplier constraints, saw the Florida-based airline fly its aircraft roughly 2 hours less on average than in 2019, which it is using as a baseline for “normal” utilization. This, plus high fuel prices, contributed to a $45 million operating loss in the quarter, and a negative 1.2 percent operating margin.
“While we are seeing good revenue results from the network changes we’ve made, we are still constrained on the number of flights we can operate to the Jacksonville air traffic control center,” Spirit Chief Commercial Officer Matt Klein said during the airline’s second-quarter results call Wednesday. Other executives, including CEO Ted Christie, cited issues with the industry’s “infrastructure” as hindering the airline’s return to pre-crisis operating and financial levels.
Jacksonville center manages most flights into and out of Florida from the rest of the U.S. Limits there more impactful on Spirit than most other airlines because 56 percent of the carrier’s flights in the second quarter touched the sunshine state, according to Cirium schedule data.
Executives at American Airlines, Delta Air Lines, United Airlines, and Southwest Airlines also cited air traffic control issues as limiters of summer flying. In June, Delta CEO Ed Bastian described the organization as the “most stressed” among industry players contributing to schedule cuts and flight disruptions.
“Unfortunately, FAA staffing is not keeping up with attrition … There should be 1,000 more controllers, not 1,000 fewer, than we had a decade ago,” the head of the National Air Traffic Controllers Association union Rich Santa said in a July speech Reuters reported. He cited numbers that the organization had 1,000 fewer certified air traffic controllers and 1,500 less total controllers at the beginning of the year than it did in 2011. Acting FAA Administrator Billy Nolen has said the organization plans to hire 1,000 new air traffic controllers in 2022.
In response to Spirit’s comments, a FAA spokesperson said the “vast majority” of airline delays are not attributable to air traffic control staffing. They provided data showing that, nationally, most delays were due to airlines or weather. The FAA did not provide delay-related data specific to the Jacksonville center that Spirit specifically mentioned for air traffic control staffing issues.
Spirit, for its part, believes that air traffic control staffing situation and other industry infrastructure constraints will support its return to “normalized utilization” — in terms of both staff and aircraft — by the middle of 2023, Chief Financial Officer Scott Haralson said. That timeline would be just in time for peak travel demand next summer.
“We have received comfort from various support entities — business partners as well as the FAA — that they are also making the necessary adjustments to have a much bigger airline business as we head into 2023,” Christie said.
Asked about Spirit’s own staffing, particularly of pilots, Christie said the airline has more flight attendants, maintenance technicians, and pilots — specifically, 30 percent more pilots — than it did in 2019. However, he added that attrition, especially among cockpit crew members, is also “significantly higher” than three years ago and that requires elevated levels of hiring and training.
Executives at JetBlue Airways, which Spirit agreed to merge with in July, have also cited elevated pilot attrition, and the issue is a top concern at regional airlines in the U.S.
Christie spent little time dwelling on the JetBlue deal, which came after a protracted bidding war between the New York-based carrier and Frontier Airlines. “Until [close] … it’s business as usual,” he said. Critical to closing the deal is sign off from the U.S. Department of Justice, which JetBlue executives do not expect before next year.
With travel demand robust, even after the summer when fears of a recession have raised questions about the outlook, Spirit is focused on growth. The carrier plans to grow passenger capacity by roughly 14 percent compared to 2019 in the third quarter, and a further 25 percent in the fourth. Spirit plans to take a “pragmatic approach” to growth in the first half of 2023 until the previously mentioned industry infrastructure issues ease.
In the second quarter, Spirit saw revenues increase 35 percent to $1.37 billion and expenses rise 66 percent to $1.41 billion compared to 2019. Fuel costs jumped 111 percent to $559 million. Total unit revenues increased 23 percent and adjusted unit costs excluding fuel nearly 29 percent.
The airline expects total revenues of $1.33-1.37 billion and a pre-tax margin of negative 1 percent to positive 1 percent in the third quarter. Total unit revenues are forecast to rise 18-21 percent compared to 2019.
Story updated with comments from the FAA.