Head of Midwest Airlines' Parent Company Rips Milwaukee

[runwayjockey]

Nobody knows or cares here in MKE. A couple of blurbs in local media and it was done. They just want a cheap ticket and that cookie. Plus, they still advertise the brainwashing mantra 'Best care in the air'. You can rip on his rip, but he is right. I was not offended. It made sense to me.

Your right there is little or no brand loyalty in MKE which is made evident by no clearly defined market leader. I'm not arguing that airline tickets are immune to price sensitivity. We all know the majority of fliers out their vote with their wallets. I'm just curious why you spend $31 million on a brand name that you refer to as nothing more than a brainwashing mantra and a cookie if all that matters is cheap tickets. I think BB wasted a great deal of money on Midwest and is coming to the realization that he clearly has no pricing power with a brand name that is languishing. You call it a rip other's including myself are arguing its a sign of weakness.

BTW, I think most competitors including myself, welcome BB's rips. We will take any help your CEO offers to help alienate customers for which we are all competing for.

 

[Propsync]

That's really all it was in the heyday. It was more about novelty than function. Everybody is thinking Midwest was some world-beater of an airline. It wasn't. 31 million to buy is cheaper than starting from scratch. How much did Skybus start with? He's lowered cost in a market that doesn't react much to price. That's what Midwest needed to do. It got very expensive to fly 118 seat 80's and 88 seat 717's. By the time Midwest figured out Tim was wrong, they were done. He won't make much money doing it this way, but he won't lose much, either.

BTW- Not an airline employee.

 

[maxblast72]

He's lowered cost in a market that doesn't react much to price.

I think you are totally wrong here. You will see alot more originating traffic at MKE now that Airtran/SWA have lowered the average fare at MKE. There is also alot of originating traffic now in the northern Chicago suburbs that is shifting from O'Hare to MKE. Can you really say that MKE has no blue collar workers that will respond to Airtran/SWA's lower fares?

 

[Propsync]

Time will tell. Midwest was slowly making inroads in the Chicago suburbs. I don't know if they (or anyone else) will stay focused on that area. If they respond to non-sunshine destinations, that will be more of a mark. Carrying a bunch of people to low yield markets won't be enough to claim victory.

 

[runwayjockey]

That's really all it was in the heyday. It was more about novelty than function. Everybody is thinking Midwest was some world-beater of an airline. It wasn't. 31 million to buy is cheaper than starting from scratch. How much did Skybus start with? He's lowered cost in a market that doesn't react much to price. That's what Midwest needed to do. It got very expensive to fly 118 seat 80's and 88 seat 717's. By the time Midwest figured out Tim was wrong, they were done. He won't make much money doing it this way, but he won't lose much, either.

BTW- Not an airline employee.

A novelty that accounted for over 50% of passengers enplanements at its peak in MKE. Now its at what 35%?

 

[runwayjockey]

Time will tell. Midwest was slowly making inroads in the Chicago suburbs. I don't know if they (or anyone else) will stay focused on that area. If they respond to non-sunshine destinations, that will be more of a mark. Carrying a bunch of people to low yield markets won't be enough to claim victory.

I'm going to shoot another hole in one of your theories that MKE and the northern suburbs of Chicago is a market that no one will stay focused on. Over 7.96 million people passed through MKE last year a trend that has been increasing over the last several decades. http://www.anna.aero/2009/07/24/midwest-becomes-republic/

The last several months have seen record amounts of travelers using MKE.

WALKER ANNOUNCES A RECORD OCTOBER FOR GENERAL MITCHELL INTERNATIONAL AIRPORT
Mitchell Moves Up to 28th in Number of Cities Served Nonstop​

MILWAUKEE (November 24, 2009) - Milwaukee County Executive Scott Walker announced today that October 2009 was the busiest on record for that month at General Mitchell International Airport. The October total of 705,989 passengers was an increase of 21.15 percent over last October's 582,722 passengers, and was the first time more than 700,000 passengers used the airport in the month of October.
Walker noted that there were 123,662 more airline seats into and out of Milwaukee this October compared to last, and 123,267 more passengers. "Wisconsin and northern Illinois passengers have enthusiastically welcomed the new low-fare flight options out of Mitchell, filling just about every seat the airlines added in October," he said.
Airport Director Barry Bateman said, "With 48 markets, Mitchell International has moved up to 28th among U.S. airports in number of markets served nonstop, according to new data published by the Brookings Institute." Mitchell's rank in a similar 2004 study was 34th. "This ranking means that more nonstop markets are served out of Milwaukee than out of other Midwestern cities, such as Nashville; Pittsburgh; Indianapolis and Columbus, and out of medium-sized cities elsewhere in the U.S., including Portland, OR; Austin; New Orleans; San Diego; Raleigh/Durham; Albuquerque; San Antonio and Hartford, CT," Bateman said. He noted that competition has heated up at the airport since Southwest Airlines launched service on November 1st and AirTran and Midwest have added flights.
The average airfare out of Milwaukee was lower than 75 other U.S. airports, according to recently released U.S. Department of Transportation statistics for 2nd Quarter 2009. Mitchell's average fare was about $44 less than O'Hare's and $28 less than the nation's average fare.

 

[lookin4better]

Hopefully Air Tran and Southwest will become more dominate in MKE and pummel Republic in all markets from that airport.

It will be great and highly deserved to see Republic fail in MKE, as they felt nothing when they dismantled the real Midwest Airlines.

Best of luck to SWA and Air Tran.

 

[starchkr]

So let me get this straight, SWA is on track to fail in MKE and DEN because they maximize their profits through economies of scale? No offense, but I don't buy your argument that SWA is "losing their asses" in DEN. The only so called expert who seems to proclaim this is Boyd and we all know how much he loves SWA. It's kind of like arguing that Wallmart must be losing their a$$es in Den because the local chain stores can't sell their goods for that cheap.

BB was banking on retaining and growing Midwest market share through Midwest branding. If he wasn't then why buy the operation and keep the name around? Frontier has a great product, but it doesn't carry the same name recognition that Midwest does in MKE. BB's hopes of leapfroging on the Midwest name to gain market share may in fact back fire with the ensuing PR night mare you guys have on your hands. The locals know you have outsourced the pilots and FA's, moved headquarters out of state, eliminated all 2x2 seating and now your CEO says MKE sucks!

I agree, customers are going to vote with their wallets. However, I am not convinced that BB has pockets deep enough to outlast the pricing power of Southwest airlines and I think BB is starting to realize this.

Best of luck to all!

Well when a company comes out and admits to losing a lot of money in a certain market then i think i can pretty easily say they are losing money...i could be wrong. As for Boyd...well, there's not really much to say about him now is there?

I'm going to have to also disagree with the usage of the word "outsourced." Midwest is owned by RAH, Republic is owned by RAH and F9 is owned by RAH...how exactly is that outsourcing if we fly under Midwest routes using other "owned" aircraft and crews. Sure i can say that Midwest...oh wait Rupeblic...has come into DEN and we have outsourced our flying to them, but in reality we have not, we have just used other company owned aircraft and crews to fly some of our routes while we send the airbus to MKE. Sure in our little miniscule pilot brains we see that as outsourcing, but it's not. Now if RAH didn't own F9 and brought a bunch of those little birds into DEN to fly for us then sure, it would be "outsourcing" as to which you referred. Also vice versa, if republic didn't own Midwest but Republic came in and flew all of their routes it would be outsourcing...again, it's not. Until you can remove it from the compnay it is "technically" not outsourcing in the way in which you referred. Would you consider NWA outsourced to DAL? How about CO to UAL...oh wait, that's another one of those crazy ruimors always floating around here. MESA to UAL...yes. Skywest to UAL...yes. Skywest to Airtran...yes(i think that's who is going to be flying for them in MKE). That's outsourcing.

 

[starchkr]

Hopefully Air Tran and Southwest will become more dominate in MKE and pummel Republic in all markets from that airport.

It will be great and highly deserved to see Republic fail in MKE, as they felt nothing when they dismantled the real Midwest Airlines.

Best of luck to SWA and Air Tran.

You wouldn't happen to be ex Midwest would you? If so, you do realize that all of us here at F9 are pulling for you right? You are not forgotten on our side of the house.

 

[runwayjockey]

Well when a company comes out and admits to losing a lot of money in a certain market then i think i can pretty easily say they are losing money...i could be wrong. As for Boyd...well, there's not really much to say about him now is there?

I.

Not trying to fan flames here, but where are you getting your info from? Could you state your sources? I would very much like to read what you are reading. I have not found anything anywhere with SWA stating they are losing their asses in DEN. In fact everything out of Gary's mouth seems to be the opposite. There is much speculation among outsiders that SWA can not be making money, but I have found no such statements specifically from SWA.

To quote Gary "There are those that will write about city performance based on public information and over-simplify the results, which can't be done. A network doesn't allow for simplicity in terms of evaluating performance."

Outsourced might have been a poor choice of words, maybe I should have said displaced.