Podcast Summary: The Air Show

Episode: The Transatlantic Evolution
Date: October 2, 2025
Hosts: Brian Sumers (A) & Brett Snyder (B)
Context: In Jon Ostrower's absence, Brian and Brett dive deep into the changing face of US-Europe airline business, exploring market shifts, joint ventures, airline failures, and evolving seasonal patterns between the two continents.

Main Theme

The episode examines the rapid evolution of the transatlantic air market over the past 20 years. Brian and Brett discuss massive growth in capacity, the dominance of joint venture alliances, the decline of independent and low-cost carriers, and the shifting nature of traveler demand and seasonality. With a characteristic blend of data-driven insight, sharp humor, and industry skepticism, they debate the consequences for airlines and passengers, and look ahead at the challenges and possible outcomes for this crucial market.

Key Discussion Points & Insights

1. Market Growth and Shifting Dynamics

• Transatlantic growth (00:56):

  • Seats between the US and Europe increased by nearly 75% from 95,000 to over 165,000/day (July 2005 vs. July 2025).
  • Contrary to expectation, average seats per departure also increased (259 → 268), despite more narrow-body aircraft.
  • Quote (Brett): “This is just a very, very big market with a lot of metal dedicated to it.” [01:23]

• YOLO Economy & Demand (01:44):

  • Growth reflects Americans’ expectation to travel to Europe every summer, despite some European pushback on tourism levels.

2. Consolidation and Joint Venture Dominance

• Decline in Airline Competition (02:20, 03:46):

  • In 2005: 38 airlines operating flights; today down to 22 joint ventures (noting the recent loss of PLAY Airlines).
  • Antitrust immunity has allowed only three joint ventures (American, Delta, United) to control 82.5% of the market.
  • Quote (Brett): “If we include ITA and SAS... 82.5% of the transatlantic seats are in one of the now only three immunized joint ventures.” [04:19]

• Regulatory Perspective (03:29):

  • Skepticism that regulators will prevent further consolidation or force more competition.

• Independent Survivors (05:23):

  • Only Turkish Airlines, Icelandair, Norse Atlantic, TAP Air Portugal, and some smaller “zombie-like” state carriers (e.g., LOT, Air Serbia) sit outside these alliances, mostly on the margins.
  • Turkish is described as “a whole different story,” behaving more like a Middle Eastern carrier; its main flows are beyond Europe (Asia, Middle East, Africa) [06:07].

3. The Fall and Failure of Low-Cost, Long-Haul Models

• Low-Cost Carrier (LCC) Viability (08:02):
  • The hosts declare the era of low-cost transatlantic flight “just about over.”
  • Quote (Brian): “When it comes to transatlantic LCCs and ULCCs, you can never be too skeptical.” [09:12]
  • Recent failures: Play Airlines is gone; Norse Atlantic is relegated to a niche, focused mostly on wet leasing.
  • Some remaining “hybrid” or leisure carriers (Condor, TUI Fly, Neos, HiSky) play small roles.

4. US-Based Challengers: JetBlue & Alaska

• JetBlue (11:10):

  • Holds just over 1% of US-Europe capacity, leveraging NYC and Boston presence, primarily seeking premium traffic (“filling mint beds”).

• Alaska Airlines (11:10, 12:12):

  • Has not yet started Europe flying; will use inherited widebodies from Hawaiian.
  • Main rationale: stem customer loss to Delta. “Strategic” ambitions are highlighted as risky and thinly justified.
  • Brett argues success may require Alaska joining joint ventures.

5. Impact and Value of Joint Ventures

• Pros and Cons (13:41, 14:16):

  • JVs usually result in more customer options/connections on established carriers, though fares are higher and competition greatly reduced.
  • Quote (Brian): “All but the most cost conscious consumers... have so many choices. You can fly one airline there, another back... That’s a good thing for all but the most cost conscious consumers.” [15:14]
  • Brett is more skeptical: “Nearly everything outside the JVs has been frozen out.” [15:41]
  • Changed landscape: US-London options dropped from 12 airlines in 2005 to 5 in 2025.

• Shift in Service Patterns (16:55):

  • Positive effects: More U.S. airports now connect to London (20% increase since 2005). US-Paris links have expanded from 14 to 22 origins.
  • Tradeoff: More breadth, less depth of competition.

6. Seasonality and Market Patterns

• Shoulder Season Expansion (19:35):
  • Seasonal routes now start earlier in spring and extend into fall; “shoulder” periods stronger than the traditional “peak.”
  • Quote (Brian): “People at Delta... said they’d rather have a market that works for six months than four.” [20:33]
• Best/Worst-Performing Markets (21:31):
  • Top growth: Italy, Spain, France (all strong leisure destinations for Americans).
  • Weakest growth: Czech Republic, Sweden (with Hungary, Ukraine, Russia completely dropped for now).

7. Airport Capacity and Constraints

• Full European Hubs (22:55):

  • Space constraints in major hubs (Heathrow, Frankfurt, etc.) limit future growth mostly to upgauging aircraft.
  • UK saw only 18% total seat growth in 20 years – the lowest of any major European country, mainly due to capacity limits.
  • Non-leisure, secondary airports in the UK and Germany lost transatlantic service.

• Italy as an Outlier (25:18):

  • Despite past dependence on niche and failed carriers (e.g., Eurofly, Meridiana), Italian airports (including smaller cities) have seen notable growth, now with joint venture nonstop service from the U.S.

8. Demand Imbalance and Trade Deficit

• Two-Way Market Realities (26:28):
  • Most transatlantic traffic is US-originating (70+% for US carriers). European partners in JVs need flows from Europe, but current travel and political climates may dampen inbound visitors to the US.
  • Scott Kirby (United CEO) cited a “trade deficit” in traffic: 60% originates in the U.S., but US carriers fill fewer seats.
  • Quote (Brett): “There’s opportunity for US Carriers to gain more.” [28:36]

9. The Saga of Italy’s Flag Carrier

• ITA & Alitalia’s Enduring Struggles (29:12):
  • Brett’s take: “If anyone can figure out how to completely screw everything up, it is the spirit of Alitalia. And that is actually what is expected of them, I would argue.” [30:16]
  • Debate if ITA (Alitalia’s successor) can ever be viable even within joint ventures or the Lufthansa Group, or if history will repeat.

Memorable Quotes & Moments

• On LCC optimism:

  • “When it comes to transatlantic LCCs and ULCCs, you can never be too skeptical.” (A/Brian, 09:12)

• On JV dominance:

  • “82.5% of the transatlantic seats are in one of the now only three immunized joint ventures.” (B/Brett, 04:19)

• On ‘strategic’ justification:

  • “As long as you say it’s strategic, you don’t actually have to make money.” (A/Brian, 12:12)

• On consumer benefit:

  • “If you’re flying Delta, United or American...you have so many choices. I think that’s a good thing for all but the most cost conscious consumers.” (A/Brian, 15:14)

• On Alitalia/ITA longevity:

  • “If anyone can figure out how to completely screw everything up, it is the spirit of Alitalia.” (B/Brett, 30:16)

Timestamps for Key Segments

| Time | Topic | |----------|--------------------------------------------------------------| | 00:56 | Data on 20-year growth in transatlantic capacity | | 03:46 | Discussion on airline consolidation & joint venture share | | 05:23 | Overview of the small, unaffiliated carriers left | | 08:02 | Decline of low-cost, long-haul carriers | | 11:10 | JetBlue and Alaska’s roles and challenges | | 14:16 | Do JVs serve consumers? Pros and cons | | 16:55 | Case study: US-London/Paris service, reduced competition | | 19:35 | Seasonality: Early summers, stronger shoulders | | 21:31 | Which countries are gaining/losing routes | | 22:55 | Airport constraints at major European hubs | | 26:28 | Demand imbalance, “trade deficit” explained | | 29:12 | The perpetual woes of Italy’s national airline(s) |

Tone & Style

• Characteristically witty, skeptical, and data-driven.
• Banter and aviation in-jokes abound (“strategic” as a dirty word; Alitalia rants; ‘best joke you’ve ever done’ quip).
• Gentle ribbing of industry “conventional wisdom.”
• Focused, but conversational and accessible for airline industry insiders and enthusiasts.

Conclusion

Brian and Brett paint a clear picture of a transatlantic airline market that’s bigger, structurally more consolidated, and less competitive than ever—dominated by three immunized alliances with only a handful of independent players relegated to niche corners. For the consumer, choice (of connections and hubbing options) has increased, but virtually all outside competition and low-fare innovation has been frozen out, with LCCs unable to survive over such long distances. With airport constraints, economic winds, and two-way demand in flux, the hosts leave listeners with questions about what might change and a reminder that, in aviation, nothing lasts forever.