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Rabu, 19 Juni 2019

Frontier Becomes First US Airline To Order A321XLR - One Mile at a Time

Read more: In the first couple of days we’ve seen A321XLR orders from Qantas, Jetstar, Aer Lingus, Iberia, Frontier, JetSMART, and Wizz Air, and American. Should passengers dread the A321XLR, though?

At the beginning of the week the A321XLR was launched, and the orders for the plane just keep coming in. This plane will launch in 2023, and will be the longest range single aisle plane in the world, with a range of 5,400 miles.

Indigo Partners orders 50 A321XLRs

Phoenix-based Indigo Partners is a private equity fund that invests in airlines around the world. If the name sounds familiar, it’s because they were looking at saving WOW Air a few months back, but that didn’t end up happening.

Indigo Partners has invested in airlines like Frontier Airlines, JetSMART, Volaris, and Wizz Air.

Today Indigo Partners has signed a memorandum of understanding to acquire 50 A321XLRs. This includes new orders for 32 A321XLRs, as well as the conversion of 18 existing A320neo orders.

Indigo Partners has already revealed how these planes will be distributed between airlines:

20 A321XLRs will be allocated to Wizz Air (Hungary)
18 A321XLRs will be allocated to Frontier (US)
12 A321XLRs will be allocated to JetSMART (Chile)

Wizz Air is getting 20 A321XLRs

What I find interesting here is that this makes Frontier the first US airline to order the A321XLR. There were rumors that American would be interested and that an order might be imminent, but Frontier beat them to the punch here.

Frankly I’m a bit surprised, because Frontier isn’t among the first US airlines I would have expected to order this plane.

What could Frontier do with A321XLRs?

Frontier is an ultra low cost carrier based in Denver. Their fleet consists exclusively of Airbus A320-family aircraft. They currently have just under 90 planes in their fleet, with nearly 200 more on order, split between the A320neo, A321neo, and now A321XLR.

The reason I find this move so fascinating is because Frontier operates very few international routes. A vast majority of their routes are domestic, and then they have a very limited number of routes to Canada, Mexico, and the Caribbean.

Today Frontier’s CEO hinted at a few possibilities for the planes:

Frontier currently struggles to fly coast-to-coast in winter with a full payload, and the A321XLR would make this easy
Frontier wants to use the A321XLR to add service to Hawaii and Alaska
In the future Frontier would consider adding flights to Europe or South America, or at least that’s not out of the question

Frontier is getting 18 A321XLRs

With Denver being Frontier’s primary hub, here’s the A321XLR’s approximate range from Denver (though they could use the plane out of other hubs as well):

I find Frontier’s order to be interesting. In the case of Aer Lingus or Iberia or Qantas I can totally say “oh, the use for these planes is obvious.”

It’s not quite as straightforward with Frontier. It seems Frontier will mostly use the planes for coast-to-coast and Hawaii flights, both of which are well within range of the A321XLR, and don’t take advantage of the full potential of the plane.

Frontier is good at sticking to their core competency, so personally I don’t think they’ll use the plane for huge expansion to South America or Europe, for example.

After all, if there’s one thing we’ve learned in the airline industry in the past few years it’s how challenging the ultra low cost transatlantic business model is.

Bottom line

A321XLRs are selling as fast as red hats and mini-constitutions in Orlando last night. This is a plane with a real market. At this point there’s almost competition between airlines to order the A321XLR — if airlines want any chance of getting delivery slots for this plane in the next decade, they’re going to have to order soon.

So there’s not only real demand for the plane, but also competition for securing slots. I think the orders will keep rolling in, even well after the Paris Air Show.

What do you make of Indigo Partners’ A321XLR order?

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https://onemileatatime.com/frontier-a321xlr/

2019-06-19 14:15:44Z
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Will the Fed boost or disappoint markets? Dow opens slightly higher - CNN

The Dow (INDU) opened 0.1%, or 35 points higher, while the S&P 500 (SPX) and Nasdaq Composite (COMP) opened 0.1% and 0.2% up, respectively. Both the S&P and Nasdaq pared their gains and dipped into negative territory just a few minutes into trading.

Hopes for an impending interest rate cut rose earlier this month, when Powell said the central bank would act as appropriate in ensuring that the US economy will keep growing. The market took this to mean that an economy-boosting rate cut was imminent and stocks rallied, as lower interest rates are good for companies.

At today's meeting, the Fed is expected to signal that lower rates are coming. That's why Powell's press conference following the 2 pm ET policy statement will be so closely watched.

Investors expect that Powell will drop the word "patient" from the statement. Since January, the Fed has said it would be patient in terms of future policy action. But those days might be over.

If Powell meets market expectations Wednesday, stocks could climb higher once again.

The likelihood for a cut at the Fed's July meeting is at 84%, according to the CME FedWatch tool.

But Powell could disappoint hopes for such swift policy action as well, which would likely push markets lower.

"Given that US unemployment is at a 50-year low, and earnings are outstripping inflation, the Fed might catch out some dealers, and deliver a more neutral update, and should that be the case, we might see stocks pullback from the recent highs," said David Madden, market analyst at CMC Markets.

Perhaps the central bank is looking for more economic data to show that the US economy is slowing and thus support a rate cut. That strategy would leave hopeful investors high and dry at least until the September policy meeting.

Either way, it could be a volatile day.

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https://www.cnn.com/2019/06/19/investing/dow-stock-market-today-fed/index.html

2019-06-19 13:47:00Z
52780316102995

Frontier Becomes First US Airline To Order A321XLR - One Mile at a Time

Indigo Partners orders 50 A321XLRs

Indigo Partners has invested in airlines like Frontier Airlines, JetSMART, Volaris, and Wizz Air.

Today Indigo Partners has signed a memorandum of understanding to acquire 50 A321XLRs. This includes new orders for 32 A321XLRs, as well as the conversion of 18 existing A320neo orders.

Indigo Partners has already revealed how these planes will be distributed between airlines:

20 A321XLRs will be allocated to Wizz Air (Hungary)
18 A321XLRs will be allocated to Frontier (US)
12 A321XLRs will be allocated to JetSMART (Chile)

Wizz Air is getting 20 A321XLRs

Frankly I’m a bit surprised, because Frontier isn’t among the first US airlines I would have expected to order this plane.

What could Frontier do with A321XLRs?

Today Frontier’s CEO hinted at a few possibilities for the planes:

Frontier currently struggles to fly coast-to-coast in winter with a full payload, and the A321XLR would make this easy
Frontier wants to use the A321XLR to add service to Hawaii and Alaska
In the future Frontier would consider adding flights to Europe or South America, or at least that’s not out of the question

Frontier is getting 18 A321XLRs

With Denver being Frontier’s primary hub, here’s the A321XLR’s approximate range from Denver (though they could use the plane out of other hubs as well):

I find Frontier’s order to be interesting. In the case of Aer Lingus or Iberia or Qantas I can totally say “oh, the use for these planes is obvious.”

Frontier is good at sticking to their core competency, so personally I don’t think they’ll use the plane for huge expansion to South America or Europe, for example.

After all, if there’s one thing we’ve learned in the airline industry in the past few years it’s how challenging the ultra low cost transatlantic business model is.

Bottom line

So there’s not only real demand for the plane, but also competition for securing slots. I think the orders will keep rolling in, even well after the Paris Air Show.

What do you make of Indigo Partners’ A321XLR order?

Let's block ads! (Why?)

https://onemileatatime.com/frontier-a321xlr/

2019-06-19 13:43:42Z
52780317246815

Frontier Becomes First US Airline To Order A321XLR - One Mile at a Time

Read more: In the first couple of days we’ve seen A321XLR orders from Qantas, Jetstar, Aer Lingus, Iberia, Frontier, JetSMART, and Wizz Air. Should passengers dread the A321XLR, though?

Indigo Partners orders 50 A321XLRs

Indigo Partners has invested in airlines like Frontier Airlines, JetSMART, Volaris, and Wizz Air.

Today Indigo Partners has signed a memorandum of understanding to acquire 50 A321XLRs. This includes new orders for 32 A321XLRs, as well as the conversion of 18 existing A320neo orders.

Indigo Partners has already revealed how these planes will be distributed between airlines:

20 A321XLRs will be allocated to Wizz Air (Hungary)
18 A321XLRs will be allocated to Frontier (US)
12 A321XLRs will be allocated to JetSMART (Chile)

Wizz Air is getting 20 A321XLRs

Frankly I’m a bit surprised, because Frontier isn’t among the first US airlines I would have expected to order this plane.

What could Frontier do with A321XLRs?

Today Frontier’s CEO hinted at a few possibilities for the planes:

Frontier currently struggles to fly coast-to-coast in winter with a full payload, and the A321XLR would make this easy
Frontier wants to use the A321XLR to add service to Hawaii and Alaska
In the future Frontier would consider adding flights to Europe or South America, or at least that’s not out of the question

Frontier is getting 18 A321XLRs

With Denver being Frontier’s primary hub, here’s the A321XLR’s approximate range from Denver (though they could use the plane out of other hubs as well):

I find Frontier’s order to be interesting. In the case of Aer Lingus or Iberia or Qantas I can totally say “oh, the use for these planes is obvious.”

Frontier is good at sticking to their core competency, so personally I don’t think they’ll use the plane for huge expansion to South America or Europe, for example.

After all, if there’s one thing we’ve learned in the airline industry in the past few years it’s how challenging the ultra low cost transatlantic business model is.

Bottom line

So there’s not only real demand for the plane, but also competition for securing slots. I think the orders will keep rolling in, even well after the Paris Air Show.

What do you make of Indigo Partners’ A321XLR order?

Let's block ads! (Why?)

https://onemileatatime.com/frontier-a321xlr/

2019-06-19 12:13:28Z
52780317246815

Trump hints at firing Powell ahead of Fed meeting: 'Let's see what he does' - Fox Business

President Trump suggested on Tuesday that he could remove Federal Reserve Chairman Jerome Powell, one day before a critical interest rate decision in Washington by policymakers at the U.S. central bank.

“Well, let’s see what he does,” he said, when a reporter asked him whether he wanted to demote Powell, whom he hand-picked in 2017.

MORE FROM FOXBUSINESS.COM...

On Wednesday, the Fed will conclude its two-day meeting, during which it’s widely expected to leave interest rates unchanged as it opens the door for a cut in July. Trump has repeatedly pressured policymakers to lower borrowing costs and frequently criticized the Fed for raising interest rates in December -- the fourth time it did so in 2018.

Bloomberg News reported earlier in the day that the White House, in February, had explored the legality of stripping Powell of his chairmanship and leaving him as a Fed governor, just two months after Trump discussed firing him.

“I’m not going to comment,” President Trump’s chief economic adviser Larry Kudlow told reporters. “It happened six months ago, and it’s not happening today, and therefore I have nothing to say about it.”

It’s unclear whether Trump has the power to fire Powell before his term ends in 2022. According to the law, the president can fire a Fed governor (for a cause) but it hasn’t been tested on the firing of a chair. Because the chair is considered to be a governor, it’s likely that it is legal.

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Advisers, however, have reportedly warned Trump that firing Powell would rock the already volatile markets -- which is likely what he hopes to avoid by replacing the chair.

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https://www.foxbusiness.com/politics/trump-hints-at-firing-powell-ahead-of-fed-meeting-lets-see-what-he-does

2019-06-19 11:50:19Z
52780316102995

Bringing Shoe Manufacturing Back To The United States Poses Challenges - NPR

Enlarge this image

Workers makes shoes at a factory in Jinjiang, in southeast China's Fujian province. Nearly all shoes sold in the U.S. are foreign-made. China's share has declined, but it's still a major source. Stringer/AFP/Getty Images hide caption

toggle caption

Stringer/AFP/Getty Images

For Douglas Clark, the darkest part of working for Nike in the 1980s was watching American shoe manufacturing "evaporate" in the Northeast in a mass exodus to Asia in pursuit of cheaper labor.

"As a true Yankee — and my father was a Colonial historian — you know, it was heartbreaking," he said.

Clark would go on to a long career in footwear, at Converse, Reebok, Timberland, then his own line of shoes at New England Footwear. And there, he would devote eight years to one mission: creating a model to make shoemaking in America profitable again.

This was a tall order. At a time when President Trump speaks of rebuilding American manufacturing, footwear is a telling example of how hard it is to turn back time.

These days, 99% of shoes sold in the U.S. are imported, many of them from China, Vietnam and Indonesia. China's share has declined in recent years, but it remains a key source of America's shoes and shoe parts. That's why some U.S. footwear companies have been loud opponents of Trump's threat of more tariffs for almost everything imported from China.

"We'd love to make shoes in the United States," Steve Madden CEO Ed Rosenfeld told NPR. "It's very hard to envision a scenario where we'd make the types of products that we make, at the prices that we make them, in the United States."

For a shoe-factory job paying $12 an hour, the actual cost of shoemaking — when adding benefits — grows to $16 an hour, compared with about $3 an hour in China, said Mike Jeppesen, head of global operations at Wolverine Worldwide, which owns brands like Merrell, Sperry and Keds. And that cost of making shoes in America quadruples after wholesale and retail markups, he said, ballooning into a $50 price difference between a pair made in the U.S. versus in China.

"There's really very little commercial reason for why you would make footwear in the U.S. today," Jeppesen said. He acknowledges one exception to that: factories that work to meet constant demand for American-made shoes by the U.S. military.

Indeed, many of the remaining 200-some U.S. footwear factories serve the military, said Tom Capps, whose Capps Shoe Co. in Virginia mainly makes uniform shoes for the government.

Capps said he employs 125 to 175 workers, depending on the factory's workload. That's on the high end for an industry where most firms employ fewer than 10 people, according to the Footwear Distributors and Retailers of America.

Owners of U.S. factories that make nonmilitary shoes in America said they found their own reasons to stay. Many cited their love of the craft and tradition. Capps said he also found a niche by offering a large selection of sizes. Olivier Marchal, of Sense of Motion Footwear in Colorado, worried about the environmental impact of shipping shoes and materials from across the world in Asia.

But U.S. factory owners also listed two major challenges of domestic footwear manufacturing: finding skilled workers and affordable parts and materials.

As shoemaking jobs disappeared, so did the support network for the industry. Suppliers of things like the little metal eyelets and colorful leather followed the industry overseas. Many shoe factories turned into warehouses and offices.

Enlarge this image

San Antonio Shoemakers has been making shoes in Texas since the 1970s. SAS recently got a big contract to make sneakers for the U.S. military. Carson Frame/The American Homefront Project hide caption

toggle caption

Carson Frame/The American Homefront Project

Dan Heselton runs Maine Mountain Moccasin out of one such factory that vacated during the exodus.

"We'll post jobs," he said, "and it's very seldom that someone under the age of 40 is coming in the door to apply." Among the workers who remain, arthritis is a common struggle.

"A lot of the people have said multiple times that they definitely don't want their son or daughter doing this," Heselton said. "That's tough to hear."

With the higher costs of U.S. labor and materials, the remaining manufacturers tend to rely on their shoppers choosing to pay more for the "Made in America" brand.

"We know that we can't make a $19 shoe to be sold at Target or Walmart. That's just not going to be possible for us," said Nancy Richardson, CEO of SAS, a midsize company that has been making shoes in San Antonio since the 1970s. "So we focus on having people feel like they get an $800 pair of shoes for $150 or $200."

The mass-market companies, meanwhile, have been turning their U.S. operations more toward design and marketing, leaving all the cutting, gluing and stitching to manufacturers overseas.

Clark wanted to change that. On his mission to return mainstream manufacturing to America, he zeroed in on the cost and complexity of the labor involved in shoemaking.

U.S. factory owners often say they wish people realized just how many parts and processes it takes to make a shoe. There are multiple layers to create the sole alone, including lots of heavy-duty sewing. Securing the bottom of the shoe takes multiple steps. By the time the shoe is ready to wear, dozens of people might have worked on it.

Clark knew about this, and about the U.S. manufacturers' struggles with materials, parts and workers. But he also knew that history was already starting to repeat itself in China. Wages have been going up there. Footwear companies have been moving — yet again — to other countries, chasing lower costs.

This could be the opening for America's comeback, Clark thought. But for it to work, the process had to be simplified — maybe a dozen parts instead of 50 — and more automated. Maybe then, he said, the manufacturing could be "where the markets are, instead of where the labor is."

A few years back, he got a contract with a big brand and a grant to get started. He began with making top parts, or uppers, "that didn't involve a lot of labor," he said.

Footwear manufacturing has long included machines — cutting or gluing soles. But higher-level innovation? Ironically, factory owners said that's happening where the industry is — overseas.

Major brands, like Nike and Adidas, have been developing new technologies, including in U.S. But they still rely heavily on factory workers abroad. Because unlike humans, robots aren't nimble — they can't notice imperfections or quickly switch to a new fashion style.

"Robots are not forgiving," Clark said.

For Clark, the story had a frustrating end. Developing automation got very expensive and progressed more slowly than expected. He was draining his funds and agreed to sell his factory to a technology company, which knew a lot about robots. The factory is now closed.

Clark had signed a noncompete agreement, so now "I'm essentially retired unwillingly," he said. He had hoped his legacy would be reviving American shoe manufacturing. Instead, he is now in real estate.

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https://www.npr.org/2019/06/19/731268823/why-the-american-shoe-disappeared-and-why-its-so-hard-to-bring-it-back

2019-06-19 11:07:00Z
CAIiEAmkAwL47v-xsJHMkS4CeSYqFggEKg4IACoGCAow9vBNMK3UCDCvpUk

Fed delivers interest rate decision: Morning Brief - Yahoo Finance

Wednesday, June 19, 2019

Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

WHAT TO WATCH

The Federal Open Market Committee (FOMC) will deliver its interest-rate decision, following a two-day meeting. After the committee’s announcement, Federal Reserve Chairman Jerome Powell will hold a press conference. Given the recent escalation of the U.S.-China trade war and slew of worrisome economic data, this month’s FOMC meeting will be even more closely watched than usual.

While consensus among economists is that there will be no rate cut following this month’s meeting, how Federal Reserve Chairman Jerome Powell illustrates the Fed’s views on the state of the economy and outlines the Fed’s future monetary path will be focal points among market watchers.

Meanwhile, tech giant Oracle (ORCL) will announce quarterly results after the market close. Analysts expect the company to report adjusted earnings of $1.07 per share on $10.94 billion of revenue.

TOP NEWS

President Donald Trump speaks during his re-election kickoff rally at the Amway Center, Tuesday, June 18, 2019, in Orlando, Fla. (AP Photo/Evan Vucci)

Trump hints that Fed should match possible ECB rate cuts: Early on Tuesday the European Central Bank suggested that it could move soon to ease its monetary policy, and President Donald Trump is challenging the Federal Reserve to do the same. In a series of tweets Tuesday morning, Trump appeared to criticize the ECB for “unfairly” devaluing the euro against the U.S. dollar. A weaker euro makes it more expensive for Europeans to buy U.S. exports, hurting the administration’s efforts to reduce the trade deficit. [Yahoo Finance]

Also: Trump asked White House lawyers for options on removing Powell [Bloomberg]

Tumbling air fares and car prices see UK inflation hit 2% target: Falling air fares and car prices contributed to a modest fall in the rate of inflation in May, with the consumer price index hitting the Bank of England’s 2% target. By and large, analysts had predicted that the rate of inflation had fallen in May from 2.1% in April, with the month seeing only a small rise in fuel prices. [Yahoo Finance UK]

Exclusive: Labour looking at delaying Britain's 5G rollout over Huawei: Britain’s main opposition party Labour is leaning towards delaying the rollout of 5G due to security concerns over Huawei, sources tell Yahoo Finance UK. While Labour is currently holding off from developing an explicit policy on the matter, due to not benefitting from all the information the Conservative-led government holds, the party is believed to be prioritizing national security over short term financial benefit. [Yahoo Finance UK]

What to know about Slack’s direct listing: On Thursday, shares of the company will open for trading on the New York Stock Exchange (^DJI) under the ticker “WORK,” making it the latest in a parade of highly-valued tech companies to go public this year. But unlike the vast majority of its peers, Slack won’t be doing so by way of an initial public offering. [Yahoo Finance]

MORE FROM YAHOO FINANCE

There are signs of stock market 'micro-bubbles'

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Disney’s upcoming streaming service is even hotter than expected

College students are overestimating how much money they can make after graduation

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2019-06-19 10:30:00Z
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