Welcome to Travel Again Presents, the weekly travel roundup covering the headwinds and tailwinds impacting the business of travel. Please welcome our hosts, Mike McCormick and Ed Silver.
Hello Mike, how are you doing?
Good, how are you doing, Ed?
I’m doing good. It was nice to see you in Dallas earlier this week.
Yep, good stuff. We’ve had a good week since we talked last. The Phillies have the best record in baseball, and the Sixers went down to the Knicks, but it was a fun series to watch. I’m all Phillies all the time now.
I know. Not sure how much sports talk we’ll get in today. Typically, we get at least twenty minutes, but we’ll see. It was good to be in Dallas preparing for our next Road Show event coming up on May 22nd. For our listeners, go to our website and register if you’re in the Dallas area or want to fly in. It’s going to be hosted by Southwest Airlines at their headquarters. Register by Friday at midnight, and you’ll have a chance to win a ride on a flight simulator at Southwest’s headquarters.
Pretty cool.
All right, Mike, let’s get to the news. There’s a lot of it.
We’re going to start with airline news. The first article is about American Airlines reported quarterly earnings. American Airlines swings to a loss but tops estimates for Q2 forecast.
It wasn’t just American’s results. All the airlines reported, and there’s a broad range of outcomes. If I were to grade them, Delta had an A-plus outcome for the first quarter. Very happy, as they should be. United is probably more of an A minus. They called out Boeing issues costing a couple of hundred million dollars, but otherwise very positive results, strong corporate and leisure.
Southwest reported some challenges, more of a B minus. Their CEO mentioned reevaluating the boarding process, which they’re famous for. They have cost issues and underlying challenges to address, and Boeing’s woes are significant for them.
Then there’s American. I’d put them more in the C or C plus category. Some positive indicators, but much of the focus was around NDC impact, combined with their corporate travel strategy, cutting corporate agreements,and reducing staff calling on corporate accounts. Analysts called out issues. Others reported double-digit growth in corporate travel, but American was reluctant to disclose specifics, talking single digits and refinements. They also pushed back their preferred agency deadline to July.
It’s not always what you do, it’s how you do it. American’s aggressive approach is causing polarization in the marketplace.
JetBlue is also interesting. New CEO, resetting the team, focusing on driving results independently. They have financial challenges, but there’s a path forward. The Alaska and Hawaiian merger is under consideration. Spirit’s CEO came out saying the industry is rigged and US consumers are long-term losers.
In one earnings cycle, there’s a lot to unpack. From an advisory perspective, this is one of those inflection points in the industry, like when travel first went online. We’re seeing a reset in relationships and distribution.
Thanks, Mike. The next article is about DOT regulations. Airlines will soon have to pay you back if they cancel or delay your flight.
This should be celebrated. The airline industry is not a free market in the purest sense. Airlines benefit from slots, gates, and financial support. There is a role for government in protecting consumers. Regardless of politics, consumers need protection and confidence. There will always be weather delays and mechanical issues, but travelers shouldn’t be hung out to dry.
Hats off to those who worked to get this in place. Automatic refunds instead of hidden credits are long overdue and good for traveler confidence.
I agree. Automatic refunds without chasing them are a big improvement.
Next article: American and United reach agreement with the city of Chicago on an $8.5 billion O’Hare Airport overhaul.
Investment in infrastructure is largely a good thing. Airports are critical hubs. As long as taxpayers and travelers are not overburdened with excessive fees, expanding capacity and modernizing facilities are important. Travel demand is back and growing. Infrastructure must support increasing numbers of travelers. It’s not just about a prettier building; it’s about capacity.
All right, Mike. Final story: Navan sets sights on IPO with new CEO and leadership team.
Navan, formerly TripActions, has been a high-profile entrant with significant valuations. An IPO will test those valuations. Zooming out, the competitive landscape is intense. Amex GBT went public via a SPAC and is acquiring CWT. Steve Singh invested in Direct Travel. You have BCD and other major players.
It’s shaping up to be a battle for the corporate customer. Airlines are forcing significant capital investment in technology. That creates challenges for medium and small agencies without deep development teams. Distribution and servicing models are under pressure. The next 12 to 24 months will likely bring significant change.
That’s the news for today. We’ll be right back with our guest.
Before our interview, let’s thank our host for the upcoming Road Show, Southwest Airlines. Their team has been first-rate. The culture at Southwest is exceptional. You see it in the hallways, in how they treat each other. We’re excited to hold our event there and appreciate their partnership.
Now it’s time for our interview. Today we’re speaking with Sós Wagar, founder and CEO of Spotnana.
Sós has spent over twenty years building businesses in travel. At Spotnana, he leads efforts to build what he calls the industry’s first travel-as-a-service platform. Before Spotnana, he founded WTMC, the first TMC to build direct connections to global airlines at the highest certification levels. Outside of Spotnana, Sós loves cooking and sharing meals.
Sós, welcome.
Thank you, Ed, thank you, Mike.
There’s a lot going on in the industry. Steve Singh’s “perfect trip” vision has sparked conversation. Given the complexity and legacy interdependencies in travel, is this achievable? Or is it a pipe dream?
It’s achievable. Timing matters. Cloud computing makes it possible at a cost that wasn’t feasible before. But technology alone is not enough. You need deep travel knowledge to understand why things are done a certain way.
When we started Spotnana in January 2020, our focus was to build a modern infrastructure from the ground up. Not just a booking tool, but the system of record and system of engagement. Travel is an emotional product. People shop around because they believe there’s always a deal. That stems from fragmented, legacy infrastructure.
We wanted to build a trip in the cloud, agnostic to distribution pipes. At the end of the day, travelers want the best fare, which isn’t always the cheapest, but the best for them at that moment.
The difference is building from the plumbing outward. That’s why we say someone has to clean the gutters. By building inside out, we can connect suppliers directly to corporations and end users in ways that weren’t possible before.
Direct Travel was purchased by Steve Singh and his investors, not Spotnana. Direct will integrate our tech stack. Our goal has always been to build an open platform. A platform only deserves that name if others make more money on it. We want TMCs, suppliers, and partners to consume, embed, and use components as they see fit.
With deep integrations, we’re not just connecting pipes. We’re building offer and order management at scale. For example, airlines can recognize a traveler and offer upgrades or entitlements based on status and corporate agreements. That changes the shopping conversation. It reduces costs for corporations and increases value for travelers.
Connecting to airlines can now happen much faster because we built an NDC framework. It took years of mistakes and learning to get there, but now we can scale connections more efficiently.
Your competitive advantage?
Focus and execution. We built this infrastructure first for ourselves, like Amazon built AWS. We built APIs not just for internal use, but for external consumption. It’s about enabling others, not building higher walls. Our moat is the technology infrastructure combined with execution.
Final question: What is not changing in travel?
Travel is a human emotion and a fundamental need. Every time it’s written off, it comes back stronger. Recession, pandemic, disruptions. Travel persists. People want to connect. That will not change.
Sós, thank you for your time and insight.
Thank you both.
Now, a quick shout-out to our sponsors, BLS and Omni Hotels and Resorts. We recently stayed at the Omni Las Colinas in Dallas, and they rolled out the red carpet for us. Great partners.
Let’s wrap with headwinds and tailwinds.
My headwind this week comes from a New York Times article on buy-now-pay-later vendors struggling with credit bureau reporting. If these loans start appearing on credit reports and consumers are confused about the impact, it could slow travel purchasing. Consumer confusion around financing travel is not good for the industry. This needs clarity.
Good one to watch.
My tailwind is stopover programs. Some airlines still allow long stopovers with perks like hotel stays. These create hidden gems and goodwill. In an era of squeezing every dollar, it’s refreshing to see programs that add magic and value. Let’s hope airlines keep these benefits alive.
That’s our show for today. Thanks again to our sponsors, BLS, Southwest, and Omni Hotels and Resorts. We’ll see you back here in approximately two weeks.
Great to see you, Ed.
A pleasure, Mike.