Spirit Airlines, Inc. SAVE has announced ratification of its five-year deal with pilots, pertaining to wage increase. The carrier initially reached the tentative agreement in January 2018. Negotiations for the contract have been reportedly carried on for three long years.
Following the ratification, wages of pilots will increase by an average 43% apart from other benefits. The deal was voted by a vast majority (98%) of pilots 70% of which, cast in favor of the move.
The ratification will enable Spirit Airlines to retain quality over quantity as in best pilots will be on its payroll to serve passengers better.
Notably, the low-cost carrier had a tiff with its pilots last year when the latter caused an illegal work slowdown, resulting in 850 flight cancellations. Consequently, the company lost approximately $45 million due to the incident.
Though pay hikes boost the efficiency of a company’s working staff by promoting loyalty and morality, the same weighs on its bottom line by lowering unit revenues.
Zacks Rank & Key Picks
Spirit Airlines carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the airline space are Deutsche Lufthansa AG DLAKY, Delta Air Lines, Inc. DAL and Southwest Airlines Co. LUV. While Deutsche Lufthansa sports a Zacks Rank #1 (Strong Buy), Delta Air Lines and Southwest Airlines carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Deutsche Lufthansa, Delta Air Lines and Southwest Airlines have gained more than 28%, 12% and 11%, respectively, in the last six months.
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