NWA answers SWA at MSP -- adds Chicago flights

[Schwanker]

[FONT=&quot]NWA to add flights to Chicago, match Southwest's air fares
By LIZ FEDOR, Star Tribune

October 22, 2008

In an aggressive response to Southwest Airlines' decision to begin service
from the Twin Cities, Northwest Airlines said Wednesday it would expand its
flights to Chicago and match Southwest's low fares.

Northwest will offer competitive prices on Southwest's connecting routes
from Chicago. Southwest, which now carries more fliers domestically than any
other airline, connects to nearly 50 cities from Chicago's Midway airport.

"We'll have 10 or more trips to both Midway and O'Hare at competitive
prices" on airplanes that include both first-class and coach seating, said
Tim Griffin, Northwest's executive vice president of marketing and
distribution. That's an increase of four to five nonstop flights daily, with
some on bigger airplanes than are used now.

Northwest also will be competing with Southwest on connecting routes.

"We always look at the full offerings of competitors, both their nonstop
participation in our markets and their connect participation, and factor
that into prices that we will offer," Griffin said. "And we'll do so this
time."

Southwest CEO Gary Kelly said in an interview in late September, when the
airline announced expansion to the Twin Cities, that he'd offer at least 8
to 10 daily departures to Midway beginning in March.

Northwest, United and American offer nonstop service between the Twin Cities
and Chicago, but no low-fare carrier has been flying the route since AirTran
Airways dropped its service to Midway in May.

Southwest, which will operate 137-seat Boeing 737s, plans to release its
schedule and fares on Nov. 6.

Griffin said Wednesday that Northwest stands a good chance of holding on to
its customers.

"The big three criteria in customer decisionmaking are schedule, price and
frequent-flier programs," Griffin said.

Southwest spokesman Chris Mainz said Wednesday that the airline is known for
stimulating traffic and decreasing fares when it enters a market. "It's a
classic example of what the Department of Transportation has coined 'the
Southwest Effect,' and it appears that Minneapolis-St. Paul is already
seeing this phenomenon in action."

[/FONT]

 

[MCDU]

No one competes better then NWA. If NWA were in ATL Valuejet never would have made it.

M

 

[CatfishVT9]

Yeah, and Braniff is gonna to kill SWA........

 

[BLUE BAYOU]

Although only briefly mentioned, its not just the flights between MSP-MDW that NWA has to worry about-- it is the 50+ connections one would get out of MDW by SWA that NWA would have to compete with also. That would seem, to me, something more of a challenge to compete with... Hey, doesn't SunCountry and SWA have the same colors now???

 

[fiel12]

Well, the commute just got easier.

 

[GuppyWN]

All this over one little 35 minute flight.

Gup

 

[ualdriver]

Although only briefly mentioned, its not just the flights between MSP-MDW that NWA has to worry about-- it is the 50+ connections one would get out of MDW by SWA that NWA would have to compete with also. That would seem, to me, something more of a challenge to compete with... Hey, doesn't SunCountry and SWA have the same colors now???

Conversely, SWA has to worry about the same with NWA/DAL/regional feeders. A passenger flying out of ORD/MDW to MSP has many, many connecting options in MSP- certainly more than SWA out of MDW.

Plus I would imagine NWA/DAL will match their fares but will have a far superior frequent flyer program (in my opinion). I would guess a business man would rather have miles on the "new" DAL network rather than SWA's, price and schedule being equal.

 

[mrebuck]

All this over one little 35 minute flight.

Gup

I agree.

 

[pipe]

Yea. Huzzah. A new fare war - that'll be great for everyone. You are now free to lose some money. Ding.

Massive sarcasm intended.

PIPE

 

[firstthird]

the difference in this 'fare war' is that SWA charges what it takes to make money (with the possible exception of a few weeks on a new route to 'introduce' it).

NWA will probably have to operate flights at a loss to match our fares. They can do that as long as they want, but I doubt they will run us out of town. I suspect the days of OALs taking a bath while they drive the LCCs out of business are gone.

Either way, passengers on the MSP-Chicago route win. At least it seems the "Southwest Effect" is still in play. You'd think it was gone with all the talk about how SWA really charges more and it is only our tricky marketing that makes people 'think' they are getting a good deal.

 

[xjhawk]

I thought it funny a couple years ago when I was flying into chicago O'hare that the gate agent said that NWA was selling one of its gates to United in a gate swapping deal. They were not happy and added that its like NWA to get rid of a gate that is used all the time and pretty full on most flights. Now they might want that gate to add more flights. Thats thinking ahead for you. Then again, NWA was thinking ahead 4 years ago when they began the process of cutting salaries, jobs, and getting ready to make the current deal with Delta. I still think they knew about the merger years ago.

just my 2c

 

[contrail67]

I thought it funny a couple years ago when I was flying into chicago O'hare that the gate agent said that NWA was selling one of its gates to United in a gate swapping deal. They were not happy and added that its like NWA to get rid of a gate that is used all the time and pretty full on most flights. Now they might want that gate to add more flights. Thats thinking ahead for you. Then again, NWA was thinking ahead 4 years ago when they began the process of cutting salaries, jobs, and getting ready to make the current deal with Delta. I still think they knew about the merger years ago.

just my 2c

And UAL is doing the same thing now.....get ready.

 

[OMNIDC10FO]

Well, the commute just got easier.

That's the first thing that crossed my mind as well!

 

[Mr Chub]

All this over one little 35 minute flight.

Gup

The flights usually 1:00 in the air...didn't want you guys to think you'd miss out on some sight seeing on your way up norT!

 

[Poahi]

This was all predictable. SWA knew that NWA would defend its turf. So how long is this war going to last? The result: lower fares and higher losses for both.

 

[777forever]

With SWA's fuel hedge cost advantage all but gone they are in for a battle.

 

[Saluki Dawg]

Only problem is, NWA isn't going to be around in their present form when we start flights there in March. The NEW DELTA will be who we are competing with, and we compete with them quite well already in most markets we go head to head on.

 

[GuppyWN]

Speaking of "the new Delta" - how you guys getting along? Must be going fairly smoothly. Unlike that other "merger" of UsWest.

Gup

 

[General Lee]

Speaking of "the new Delta" - how you guys getting along? Must be going fairly smoothly. Unlike that other "merger" of UsWest.

Gup

Seniority integration hearings with the 3 arbitrators are going on now, and have been interesting to read (the transcripts). The one good thing that we did that USAir did NOT do was get a joint contract first. That will help soften the blow to whichever side or if both sides get "the shaft."


Bye Bye--General Lee

 

[The Prussian]

[FONT=&quot]In an aggressive response to Southwest Airlines' decision to begin service [/FONT][FONT=&quot]from the Twin Cities, Northwest Airlines said Wednesday it would expand its [/FONT][FONT=&quot]flights to Chicago and match Southwest's low fares.[/FONT]

Does Northwest really want to get involved in this? It's worked in the past, but times are changing. Northwest will now be part of a huge network spanning the globe with Delta. They are taking on a competitor that has a huge domestic presence. Global recession is now looking imminent in the year going forward. Delta/Northwest's Int'l loads are going to be anemic IMHO. That's lots of heavy jets crossing big ponds with low load factors. Not a recipe for making money. On the other hand you have Southwest, making money with/without fuel hedging, across a huge domestic route network at discount fares. Who do you think could outlast who??? Northwest, under new Delta management may start to rethink the wisdom of protecting turf, in favor of survival...the deeper of the two issues.