We have a very small amount of engines that were manufactured pre-2021. And so I think that’s what you were referencing in terms of the handful that are pre-2021 are going to need full part replacements. We do have a view on how the A220 PW1500 will impact us next year, and that is built into the mid or high single digits, low single digit number by the end of next year. It’s very small compared to the A321 aircraft in terms of exposure. So hopefully that helps.
Shannon Doherty: Yes, that is. That’s really helpful. Thanks, Ursula. And we saw that you pulled eight percentage points of capacity growth in the March quarter schedules over this past weekend. Was that driven by the anticipated acceleration of the groundings? Or was that a demand-driven cut, maybe something that you’re seeing in the off-peak period before spring break or something? Thank you.
Dave Clark: Sure. Thanks for the question. This is Dave. Thank you. The Q1 2024 capacity cut is driven by aircraft availability constraints. So largely, the engines and the delivery delays. And we expect that to remain the case throughout 2024.
Shannon Doherty: Thank you.
Operator: Your next question comes from Duane Pfennigwerth with Evercore ISI. Please go ahead.
Duane Pfennigwerth: Hey thank you. Can we talk a little bit about the revenue outcome, capacity up 7%, revenue down 8%. Obviously, you’re taking some steps on capacity into 4Q and into early next year. But maybe within domestic, can you speak about relatively stronger versus weaker markets within the domestic entity, how does your Latin RASM compare with that domestic decline? And obviously, many of these NEA changes were forced on you without much lead time and I guess, over time, you’d be able to plan for that a little bit better. Can you quantify how much the NEA wind-down acted you in the quarter?
Dave Clark: Sure. Thanks, Duane. This is Dave. I’ll take that. So clearly, it’s been a challenging environment as we’ve seen demand sort of transition out of the domestic space in the third quarter on a year-over-year basis while at the same time, a lot of capacity was coming in from the industry. Where we’ve been reallocating capacity out of and have seen, I think, the most acute demand challenges have been in some of the shorter-haul markets in some of the business markets. So we’ve really focused there to right size that capacity to the new reality in those markets. The corporate side continues to recover for us, but it’s still well below about 20% below the revenues of pre-COVID. Latin continues to be pretty resilient, and we’ve been growing there and traditionally have done extremely well there.
And then some other places like Florida has a lot of industry capacity right now. Demand is healthy. We have no concerns there, but it’s a bit, I’d say, temporarily pressured by industry capacity, which should, I’d say, absorb over time. But we’ve really been focused on the places where we’ve seen demand roll out and making sure that we’re aligned. With regards to New York City, the NEA for the first — for the third quarter was about a one-point headwind. We did have a partial quarter there as we didn’t terminate until late July. So we did have some sales for the quarter. It grows to about two points this quarter, which we expect to be the biggest impact and then starts to get better next year as we can allocate more capacity out of New York City and take advantage of the redeployments we’ve done recently.
Joanna Geraghty: I’ll also add on transatlantic. Also some very strong performance there. 140% ASM growth with flat year-over-year RASM and I think you see some of the moves we’re making in terms of Dublin and Scotland trying to take advantage of that leisure seasonal flying.
Robin Hayes: Yes, Joanna, you had the honor of having all three of us to answer a question. I think that what we’re trying to be very — it is very easy to reallocate capacity in this industry. It’s very mobile, it moves quickly. And sometimes things become hot very quickly and everyone moves towards it and then ends up being oversupplied. And so what we’re trying to do is kind of be very thoughtful around not just sort of the immediate trends that we’re seeing now and some of the commentary. But what do we think kind of sits behind that because the really good news for us is the new slot waiver, which we know about now means that we can be much more considered about these changes rather than sort of having to pull latest short notice, order of [Indiscernible]. We’ve got the cost embedded in the business, not really an opportunity to efficiently redeploy that. It’s a very different chessboard we have in front of us for 2024.
Duane Pfennigwerth: Okay. Thanks for those thoughts. And just for my follow-up on 2024 CapEx. It looks like you have a contractual delivery table and then some footnotes with kind of likely deliveries. Simple question. Does the aircraft commitments CapEx of roughly $2.2 billion reflect your contractual or likely deliveries, a very long-winded way of asking you what your total CapEx will be next year?
Ursula Hurley: So there’s definitely a difference between our contractual commitments and what we’re planning. So we’re planning to receive 28 aircraft. However, the CapEx number you referenced is ballpark where we should end up.
Duane Pfennigwerth: And what would we add to that $2.2 billion? What would your total be?
Ursula Hurley: It will be slightly less than that. Actual commitments are higher.
Duane Pfennigwerth: Thank you.
Operator: Your next question comes from Catherine O’Brien with Goldman Sachs. Please go ahead.
Catherine O’Brien: Hey good morning everyone. Thanks for the time. I just wanted to dig in on New York a little bit more. Now you have the advanced notice of the slot relief in New York this upcoming summer, how should that impact profitability? And I guess, longer term, do we need to get back to full ability to fly your New York slot portfolio was like pre-COVID operational reliability for those New York margins to recover. I guess, how do you think about getting back to 2019 margins on a system basis without a New York recovery — full New York recovery? Is that possible?
Joanna Geraghty: So we do expect a full New York recovery. It’s just a bit slower than I think anybody would have hoped. But if you look specifically at JFK, for example, we’re really pleased with the progression that JFK is making. In terms of the operational impact in ATC, our hope is now that there’s an administrator we’ll see even greater focus on how to ensure that New York is staffed appropriately from an air traffic control perspective. And that’s a couple of years in the making. It takes a little while to fully bring on staffing, but we’re hopeful that with the slot waivers, that’s not something that’s sustainable. And at some point, the underlying issue has got to be addressed in a more thoughtful way.
