Spirit to start charging for bags and drinks..

[FlyBoeingJets]

We joke about it but this is the eventual reality that we all face. Spirit mgt has decided that they can not compete with the likes of SWA and B6. So in a price driven market how does one effectively grab market share? Be the cheapest.

Airlines like SWA and B6 don't need to do this to compete but if this works expect Airtran and Frontier to follow rather quickly and expect them to try and out do Spirit.

Price driven is all relative. If you are starting new service in a market served by others, you have to offer lower fares. SWA does it too. They take a loss until the passenger traffic is established then discontinue the "specials". Fares even go a little higher when they dominate an airport. How else would the company afford to enter a new market and take losses on the new service for a little while? That said, SWA still keeps all fares relatively low. Mainly to keep the market from being challenged and for customer loyalty.

Recent observations from friends and family:

Corporate refundable fares (RJ service) less than 700 miles into/out of CVG (Delta super fortress hub) are $700+. For MEM (NWA hub with a little competition) its $250-$400. For a SWA served city pair $65-140.

 

[G4G5]

Expect Airtran and Frontier to follow quickly?? Good way to stir the pot, either that or your a moron...

The Frontier pilots showed us all what a huge set of man berries they have with that contract extension.

Frontier is having trouble gaining market share. So let's see they can increase their service and customers will come with check books in hand.

Or they can lower their costs. Humm..............

They can ask the pilots for more (LMAO), pay less for fuel or pay the lessors less every month.....Hummm. None of the above will happen, (except the pilots caving again)

Or they could follow the likes of Spirit (if it works) and gain market share without having to do any of the above. Humm.....

You have a better plan?

If this works for Spirt, they will follow.

 

[G4G5]

Price driven is all relative. If you are starting new service in a market served by others, you have to offer lower fares. SWA does it too. They take a loss until the passenger traffic is established then discontinue the "specials". Fares even go a little higher when they dominate an airport. How else would the company afford to enter a new market and take losses on the new service for a little while? That said, SWA still keeps all fares relatively low. Mainly to keep the market from being challenged and for customer loyalty.

Recent observations from friends and family:

Corporate refundable fares (RJ service) less than 700 miles into/out of CVG (Delta super fortress hub) are $700+. For MEM (NWA hub with a little competition) its $250-$400. For a SWA served city pair $65-140.

How else would the company afford to enter a new market and take losses on the new service for a little while?

You answered your own question. Based upon price. If (and when) a US carrier takes the Ryan Air approach, they WILL gain market share.

This isn't rocket science. Ryan Air has taken the SWA model one step further and proved that they can make money. The model is already there. This is not a revelation. The problem is, no airline has been able to effectively market, "being the cheapest, is the best". Every LLC has taken on an approach of providing value and low costs. No one has come out directly and said, we are going to be the cheapest, to heck with service.

Spirt has decided that they are going to be the first to copy Ryan Air in the US. If it works, expect the others to follow (they won't have a choice).

 

[FlyBoeingJets]

My point was Spirit needs to be attacking certain competitors in higher yield markets. If they hope to compete against SWA they are already behind the 8 ball. SWA has lots of higher yield markets to shield them from a price war in a couple of Spirit markets.

If Spirit attacks the high yield legacies they have a chance, but the legacy's profitable networks can make up the difference elsewhere. At least Spirit doesn't have to go ultra low fare to make it work. This is a tough call and has led many a carrier to ruin in market conditions like these.

Airtran, Frontier and JetBlue may be their best bet to challenge in a price war. They may not be able to hang long with the "lowest" fare Spirit challenge.

To me, Spirit looks desperate and wild eyed. A risky move meant to make something good happen for them.

But what do I know. I just drive'em

 

[gt1900]

Any body think that maybe the reason Spirit is trying something new is because their old business model wasn't working?? I really have no idea since they are a private company, BUT, if it works, don't fix it, and they are fixing things. To me it seems like a desperate shot at trying to get pax on their planes.... It might work, but it might not. As far as Frontier goes, there is a lot of things company's can do to lower the costs. I just noticed that Frontier recieved the lowest rating of all the LCC's in a poll done by somebody (it was on Flightinfo but I'm not gonna go try to find it). Hell, Frontier has a better product than AAI and SWA, but they got the lowest rating of all the 4 LCC's. F9 has to do it better than SWA and UAL or they will not be around in 10 years, and right now, it doesn't seem like they are doing it.. Simple rule, make passengers happy and they will come back, if you don't, your out of business.. SWA has been the best at making pax happy for years...

 

[G4G5]

You can't go head to head with LUV on a particular "high yelid" market. They could afford to fly it for a loss and you would eventually have to cave in.

That's the problem. Luv has such a strong presence that comepting with them on price is fruitless.

 

[crashpad]

Expect Airtran and Frontier to follow quickly?? Good way to stir the pot, either that or your a moron...

Let's refrain from name calling and keep this in perspective.
The article states Spirit is actually reducing the cost of extra baggage from their current policy. Either way, it's smart business and they know exactly what they're doing. Any airline which follows suit will also benefit.

I think G4GWhizz has a bone to pick with airlines because he got shooed away. He certainly has nothing to be ashamed of. Not everyone has what it takes to make it through the process. I've know doubt he's an excellent corporate pilot and valueable assest to General Aviation.

 

[G4G5]

Let's refrain from name calling and keep this in perspective.
The article states Spirit is actually reducing the cost of extra baggage from their current policy. Either way, it's smart business and they know exactly what they're doing. Any airline which follows suit will also benefit.

I think G4GWhizz has a bone to pick with airlines because he got shooed away. He certainly has nothing to be ashamed of. Not everyone has what it takes to make it through the process. I've know doubt he's an excellent corporate pilot and valueable assest to General Aviation.

Man you could not be further from reality. Been there done that and I have an ample supply of halloween costumes to choose from.

FYI, I turned down Jetblue to go to NWA from which I quit to go to DAL, then onto AA. I am currently furloughed AA and have zero intension of going back anytime soon (always leave the door open).

 

[crashpad]

NWA to DAL to AA? Really GWhizz, it's sounds like the airline industry gave you every opportunity. What would you "leave the door open" for?

 

[FlyBoeingJets]

....from which I quit to go to DAL, then onto AA.

Ouch! That had to leave a mark...

Like the 5 year FedEx folks leaving for AA around the same time.