Cardinal
Of The Kremlin
- Joined
- Nov 25, 2001
- Posts
- 2,308
F9 usually struggles along just shy of breakeven, and then all of a sudden sees a $30 million loss, -9% operating margin. Something happened, and it wasn't just fuel, else the pack would also be reporting steep losses, but most everybody's just been kicked back to near breakeven.
That something was unrestrained capacity growth/mismanagement, and a total abortion, absolute clusterfuqeria on the regional side. Today the CEO presented an excellent state of the airline address. Mainline CASM was down significantly, the bleeding lie elsewhere.
2/3s of the quarterly loss was in the regional operations column. In early December we were paying FOUR different regional operators for lift, QX, RP, XE, and L4 to serve the same handful of cities out of one hub. All were at sub-optimal numbers, and one was positively hemhorraging cash for zero return. 70 seat RJ's were flying markets meant for turboprops. Next quarter will see only two regional operations, both with optimized fleets, doing what they're supposed to do. The "transition" on the regional side is complete, and by next quarter mainline capacity will be fully adjusted in line with the new management's wishes.
Menke has hacked away all the flying that resulted in obviously empty flights, kicked some ass at the corporate offices, and fired some people. All good signs. At this point I see no need to get on the davits and lower the lifeboats.
That something was unrestrained capacity growth/mismanagement, and a total abortion, absolute clusterfuqeria on the regional side. Today the CEO presented an excellent state of the airline address. Mainline CASM was down significantly, the bleeding lie elsewhere.
2/3s of the quarterly loss was in the regional operations column. In early December we were paying FOUR different regional operators for lift, QX, RP, XE, and L4 to serve the same handful of cities out of one hub. All were at sub-optimal numbers, and one was positively hemhorraging cash for zero return. 70 seat RJ's were flying markets meant for turboprops. Next quarter will see only two regional operations, both with optimized fleets, doing what they're supposed to do. The "transition" on the regional side is complete, and by next quarter mainline capacity will be fully adjusted in line with the new management's wishes.
Menke has hacked away all the flying that resulted in obviously empty flights, kicked some ass at the corporate offices, and fired some people. All good signs. At this point I see no need to get on the davits and lower the lifeboats.
