MCO - the next battle + JBLU/FRNT merger

[lowecur]

The last time I made a prediction like this was at MDW a few years ago and I was hammered by the folks at ATA.

DL has apparently worked out a new deal till 2008 on their remaining gates. I believe their are 16 up for grabs, and there's talk that AirTran and Jetblue are in a bidding process to gain control of at least 10-12 of them. They both have plans to apparently make MCO a major focus/hub. Makes sense with all the new iron coming down the pike, and it will be a tough decision for MCO mgt since both have an integral presence in the city.

I know the braintrust at blue is busy tweaking their model to gain more yield and RASM. They should begin making announcements this month on some of those changes, but it will remain a fluid work in progress until MCO makes their decision.

They still need a hub out West, and it's my guess they could be in preliminary talks with FRNT. Blue has no use for Frontier Express, and stictly wants the 16 gates at DEN. I believe FRNT buys their IFE from blue so the fleet compatibility should be fine providing the powerplants are the same mfg. FRNT is presently valued somewhere north of $255M and has approx $150M unrestricted cash. Of course there would be the usual cast of characters that would try to screw the deal at the last minute, so it may be more trouble than it's worth. I wouldn't look to hear anything serious until Jetblue has it's own house in order and has more 190s on property. Look for this to come to fruition sometime late 2007. Jetblue would hope that many of the spoilers would be in the middle of legacy mergers, so this would lessen the players that could screw the deal.



imp:

 

[SDF2BUF2MCO]

They both have plans to apparently make MCO a major focus/hub.
imp:

Good. Maybe one of them will make a it base (before 2007!) - my house is for sale .

 

[BoilerUP]

What would be the benefit of having both the A318 and the E190? Don't they cover nearly the same market? I may be a dumb pilot but I'd think you'd want to ditch the brazillian jets to gain the same-family efficiency of scale the 318/319/320 would provide (and JBU recently gave up).

Never flown on Jetblue but Frontier has always treated me GREAT as a jumpseater...and the animal tails are the best thing going in contemporary aviation livery.

 

[rayford steele]

What would be the benefit of having both the A318 and the E190? Don't they cover nearly the same market? I may be a dumb pilot but I'd think you'd want to ditch the brazillian jets to gain the same-family efficiency of scale the 318/319/320 would provide (and JBU recently gave up).

The A318's would be gone....guaranteed.

 

[rayford steele]

They still need a hub out West, and it's my guess they could be in preliminary talks with FRNT. Blue has no use for Frontier Express, and stictly wants the 16 gates at DEN. I believe FRNT buys their IFE from blue so the fleet compatibility should be fine providing the powerplants are the same mfg. FRNT is presently valued somewhere north of $255M and has approx $150M unrestricted cash. Of course there would be the usual cast of characters that would try to screw the deal at the last minute, so it may be more trouble than it's worth. I wouldn't look to hear anything serious until Jetblue has it's own house in order and has more 190s on property. Look for this to come to fruition sometime late 2007. Jetblue would hope that many of the spoilers would be in the middle of legacy mergers, so this would lessen the players that could screw the deal.



imp:

Anyone remember the last airline that bought Frontier? Ouch........

 

[lowecur]

The A318's would be gone....guaranteed.

I think they only have 5, so I think you're right.

imp:

 

[Vastly Underemp]

Was it Commuter Airlines, Inc Binghamton, NY?

 

[General Lee]

The last time I made a prediction like this was at MDW a few years ago and I was hammered by the folks at ATA.

DL has apparently worked out a new deal till 2008 on their remaining gates. I believe their are 16 up for grabs, and there's talk that AirTran and Jetblue are in a bidding process to gain control of at least 10-12 of them. They both have plans to apparently make MCO a major focus/hub. Makes sense with all the new iron coming down the pike, and it will be a tough decision for MCO mgt since both have an integral presence in the city.

I know the braintrust at blue is busy tweaking their model to gain more yield and RASM. They should begin making announcements this month on some of those changes, but it will remain a fluid work in progress until MCO makes their decision.

They still need a hub out West, and it's my guess they could be in preliminary talks with FRNT. Blue has no use for Frontier Express, and stictly wants the 16 gates at DEN. I believe FRNT buys their IFE from blue so the fleet compatibility should be fine providing the powerplants are the same mfg. FRNT is presently valued somewhere north of $255M and has approx $150M unrestricted cash. Of course there would be the usual cast of characters that would try to screw the deal at the last minute, so it may be more trouble than it's worth. I wouldn't look to hear anything serious until Jetblue has it's own house in order and has more 190s on property. Look for this to come to fruition sometime late 2007. Jetblue would hope that many of the spoilers would be in the middle of legacy mergers, so this would lessen the players that could screw the deal.



imp:

It appears Neeleman doesn't want to take on Southwest if he doesn't have to. Right now the only route where they have exact competition will be the eventual BUR to LAS flight. Other than that, B6 has done a good job going after Majors instead of LCCs. That would change in DEN, since Southwest will being having more than 100 daily departures by the end of this year. Same at SLC, where Southwest hits most of the major Western cities (LAS, BOI, PDX, SEA,GEG, LAX, ABQ, OAK, PHX, DEN) and many Midwestern cities (MDW, STL, MCI), and even BWI in the East. Southwest has the ability to go after new entrants, and the only reason Majors coexist is because of the mainline feed from cities not served by LCCs, regional feed from smaller cities, and INTL feed. I am very interested to see what Neeleman does next.

Bye Bye-General Lee

 

[lowecur]

It appears Neeleman doesn't want to take on Southwest if he doesn't have to. Right now the only route where they have exact competition will be the eventual BUR to LAS flight. Other than that, B6 has done a good job going after Majors instead of LCCs. That would change in DEN, since Southwest will being having more than 100 daily departures by the end of this year. Same at SLC, where Southwest hits most of the major Western cities (LAS, BOI, PDX, SEA,GEG, LAX, ABQ, OAK, PHX, DEN) and many Midwestern cities (MDW, STL, MCI), and even BWI in the East. Southwest has the ability to go after new entrants, and the only reason Majors coexist is because of the mainline feed from cities not served by LCCs, regional feed from smaller cities, and INTL feed. I am very interested to see what Neeleman does next.

Bye Bye-General Lee

Maybe you know something I don't. As far as I know Southwest only has a commitment of 5 gates at DIA. Where do they plan to get more, and where does it say they will get them?

What's amazing is that FRNT couldn't get any gates at DIA a few years ago, and now they are popping up all over the place. UAL must be returning unused gates to DIA.

Neeleman's hand will be forced to fly many of the same routes as SWA. You can't avoid them forever, especially with their recent penchant for legacy strongholds.

imp:

 

[GogglesPisano]

I'm sorry, I just can't see JB merging with any union carrier. They have a distinctive corporate culture that is worth (to them) more than gates, slots ...