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 ...

 

[lowecur]

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 ...

You may be right. Much will depend on the next 12 months and the $150M they have in the bank. They are presently working without a contract, so they do have people who are staunch pro-union. Desperation makes strange bedfellows, and much will depend on how both companies do in the 12 months.

imp:

 

[rayford steele]

Was it Commuter Airlines, Inc Binghamton, NY?

Nope. And it wasn't Colgan either.

 

[BoilerUP]

Wasn't it UAL?

 

[180ToTheMarker]

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

People Express in '85. The both merged into CAL in '86. Ahh...the good ole' Lorenzo days. uke:

 

[F9 Driver]

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

For the gory details:

http://fal-1.tripod.com/FL_Death.html

IMHO there won't be mergers in the LCC world, but a code share network of LCCs would be a major player.

 

[rayford steele]

People Express in '85. The both merged into CAL in '86. Ahh...the good ole' Lorenzo days. uke:

We have a winner. Perhaps history is repeating itself. Hopefully with better results.

 

[jetblue320]

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:

I used to enjoy your insightful posts but now I think maybe you are really dreaming.

No deals, no mergers. But keep the faith..............

 

[lowecur]

I used to enjoy your insightful posts but now I think maybe you are really dreaming.

No deals, no mergers. But keep the faith..............

No deal at MCO? Sorry 320, but I believe Jetblue will do what it has to do get those gates. I believe it's an integral part of their strategy east of the Mississippi.

Merger with FRNT? Humor me for a change, it's good for the soul! Besides, never say never in this business.

imp:

 

[IronCityBlue]

engines

the fleet compatibility should be fine providing the powerplants are the same mfg. imp:

Not that this is the bigest factor by any means, but the powerplants are different. Chalk that one up on the "do not merge the two" column. Like you said though, never say never in this biz.

And I agree, the 318 would be toast, unless they got too good of a deal to get ride of them (which I doubt) in which case they could still keep them but logisticaly the 190 is economically superior all around. Enough to more than offset the infamous and sometimes overrated dead horse pilot commonality and parts inventory schpeel.

 

[coogebeachhotel]

Not that this is the bigest factor by any means, but the powerplants are different. Chalk that one up on the "do not merge the two" column. Like you said though, never say never in this biz.

And I agree, the 318 would be toast, unless they got too good of a deal to get ride of them (which I doubt) in which case they could still keep them but logisticaly the 190 is economically superior all around. Enough to more than offset the infamous and sometimes overrated dead horse pilot commonality and parts inventory schpeel.

Spare parts inventories are overrated. Most airplanes and engines are "power by the hour" or warranty. Whatever breaks is already paid for by the "insurance policy". A premium is a premium.

 

[BLUE BAYOU]

After our acquisition of LiveTV, we've found and most importantly our leaders have found that it is very difficult to shove a culture down one that already exists. The buyout has been a painful one. Can you believe it took nearly a year to put a sign on the hangar in MCO because LiveTV did not want Jetblue on it? It now says LiveTV on it... I really don't think we'll be seeing a merger of any sorts, any time soon!!! Additionally, we could've sent the 190s to a regional carrier that would've operated it even cheaper than the current rates, yes, let me say it again, even cheaper than the current rates-- but because our brand is important to our company, we decided to keep it under the same roof>>> Look at what Republic pays their 170 crews and you'll actually like the $37 per hour an F/O makes at Jetblue...

 

[Atlanta Vicks]

I think they only have 5, so I think you're right.[/color]

imp:

7 currently but who's counting?

 

[3BCat]

I agree with you Blue Bayou, about no merger for B6.

I heard the sign issue was generated by MCO Airport Authority demanding payment for advertising. JetBlue already has their name on the Training Center. They faced exhorbitant fees from MCO if they put "JetBlue" on the hangar, too.

If you own 'em, you own 'em! They can do what they want with the building. "LiveTV" sign was put up to circumvent additional fees.

 

[CosmoKramer]

you're way off....Spirit and Fronteir will merge....get it right jacky.....

 

[Tomct]

BlueBayu, I would not be too proud of those rates! Not exactly earth shattering!!!

 

[AlbieF15]

Hey Atlanta Vicks...

How many sports heros have been sued for spreading Herpes? I'm a Falcons fan, but c'mon...you REALLY think he's all that cool?

 

[enigma]

you're way off....Spirit and Fronteir will merge....get it right jacky.....



You can pick your freinds, and you can pick your nose----but you can't pick your freind's nose.

i before e. except after c.

If Spirit and Frontier merge, I'll be offering to trade my FLL CA slot for a DIA CA slot. Any takers? I'll even throw in a well used FL registered crashpad auto for nothing.

enigma

 

[BLUE BAYOU]

BlueBayu, I would not be too proud of those rates! Not exactly earth shattering!!!

I'm not proud of our rates... I merely stated that if we wanted to "job out" to a Mesa or in this case a Republic/Shuttle America their Capts get 66/hour and F/Os 22/hour the first year... We could have but didn't. Furthermore, you should've seen the A320 rates in the first year of operation here, it was 78 for capt and 43 for f/o... there wasn't much moaning then about our pay rates because we were just a spec of dust on the wall... Now that we own two specs of dust on the wall, it somehow matters how???

 

[Atlanta Vicks]

Hey Atlanta Vicks...

How many sports heros have been sued for spreading Herpes? I'm a Falcons fan, but c'mon...you REALLY think he's all that cool?

Vick is the shiz! As far as the herpes thing goes, so what? We all have our skeletons and transgressions. All that matters is that he wins games which he has been doing. The defense let us down this past year.