The industry did considerably more of it. And listen, it was quite profitable for us, but at the expense of unit revenues. And so, as we move through next year, I’d say there’s going to be probably a moderation of capacity as there always is when those things happen as well as easier comps as we get to next year. So, I’m looking forward to actually next year’s comps in Latin America.
Brandon Oglenski: Okay. Thank you.
Operator: Thank you. Your next question is coming from Conor Cunningham from Melius Research. Your line is live.
Conor Cunningham: Hi, everyone. Thank you. Just if we play back the performance in the US domestic market in 1Q, it was pretty fantastic when you started off saying just expecting to inflect positive in March and you saw some improvement in quarter, then an outcome of plus 3%. You’ve highlighted corporate momentum in premium, but I think there’s a disparity in just your hub performance. Can you just talk about coastal gateways versus core hub rebuild and how things are playing out there, just in general? Thank you.
Glen Hauenstein: Well, I think we’re very pleased with our coastal gateways and really they’re moving in a pretty tight band right now with more capacity going to our core hubs and our core hubs generally having a higher unit revenue base than our coastal gateways, that should have a positive inflection on total revenues. And I think that gets accelerated in the second and third quarters. Again, we had probably a little bit more in Boston than we had planned on because there were some opportunities there for us to move airplanes in. But generally, we’re really pleased with where we sit today and how the back half of this year should play out for us.
Conor Cunningham: Okay. And then, it seems like there’s a potential for regulatory oversight to potentially pick up here. When you have conversations with the FAA, what are some changes that they’re talking to you about just given the operating environment? And maybe what are you asking them in general? It just seems like it could be a wildcard to potential growth, maybe medium-to-long term. So, just any thoughts there would be helpful. Thank you.
Peter Carter: Hey, Conor, this is Peter. So, just I’d say, fundamentally with the FAA, we’re working very closely with them around staffing models, because as you know, there’s an air traffic control shortage. And we’re also engaged in Washington trying to help solve some of those, I’ll say, more structural challenges around infrastructure. You probably have seen that the industry has made a request off the FAA to extend the New York Slot Waiver another season. And that’s what I would call responsible partnership with our regulator in light of the staffing challenges they’ve had. So, a great relationship, deep partnership with them.
Conor Cunningham: Okay. Thank you.
Operator: Thank you. Your next question is coming from Savi Syth from Raymond James. Your line is live.
Savi Syth: Hey, good morning. Just a follow-up to Jamie’s question on the premium revenue. Just kind of curious if you could share how much of that 10% is coming from volume versus yield, and I think you mentioned continuing to grow the premium offering. So just curious what the trend might be.
Glen Hauenstein: Right. I would say, right now, the premium is probably 50-50 split between traffic and yield.
Savi Syth: That’s helpful. And then in terms of the volume growth in offering, how should we think about that?
Glen Hauenstein: Well, I think we’ve said that, if you look at the longer-term trends, that we really haven’t been adding coach seats into the domestic arena over the past 10 years. And so, all of our growth has been in the premium products and services. And I think on Investor Day, we’re going to talk a little bit more about where we see that going, but I think we see a long runway for that in the coming years.
Dan Janki: Yes. Premium product while pace main cabin all the way as you look at our fleet deliveries through 2030.
Savi Syth: Helpful. And if I might on another follow-up, just on the domestic capacity growth with building back the hubs, is that then where the capacity comes a lot in this kind of regional-type markets or should I think of it as kind of growth in regional then shift some of those aircraft on to kind of other bigger markets that you could use those aircraft?
Glen Hauenstein: I think little of both. We’ve been very short on our regionals. We still have probably at least 50 regionals either not flying or underutilized, probably almost 100 when you include the underutilization. So, that’s a lot of seats and a lot of departures that we need in our hubs and we’re missing a lot of the core feed from the regional feed in the local vicinity. So, right now, some of that’s being done by Mainline and those planes can gravitate out, but mostly we’ll be adding frequencies back in that historically have been there from feeder markets into our core hubs.
Savi Syth: Helpful. Thank you.
Operator: Thank you. Your next question is coming from David Vernon from Bernstein. Your line is live.
David Vernon: Maybe just following up on that point of thought there, Glen, as you think about the improvements in the regional utilization, is there also some room for improving utilization to prior pre-COVID levels on the narrow body fleet as well? Or is this primarily just a regional issue?
Glen Hauenstein: No, I would hope so. If we look at our wide bodies, we’re now at or above where we were in ’19 in terms of annual utilization. And this is going to be a game of working with our operators to improve asset utilization across the network, whatever they are, planes, airports. And that’s the game we’re playing, that’s the long game and I think that’s been a really exciting challenge for us all.
