SWA rumor control

[Choppy]

SWA and Paulding Co airport... never gonna happen.

 

[runwayjockey]

You want to know what they have planned? So does everyone else. Go to the source and find out what's planned for next year and what is not.


http://seekingalpha.com/article/183722-southwest-airlines-q4-2009-earnings-call-transcript

 

[boeingdriver213]

Unless management says it, it isn't going to happen, no matter how bad we want it or how many "In the know" people we talk to. Sorry.

 

[ACL65PILOT]

In regards to the ATL hub, a new airport is being built about 30 miles W-NW of ATL in Paulding County, near Dallas, GA. I've heard rumors about SW moving into that airport, but it doesn't look large enough for airline service.

http://www.pauldingairport.com/

 

[Falcon Jet 1]

looking the weight limit at the airport, I dont know if that is a structural limitation or a policy for longevity of the airport, but anyway 90K lbs aint gonna work

 

[Taco Rocket]

Southwest will buy everyone, there will be no competition, the 787 will be introduced, and everyone hired (at a rate of 5,000 a year) will start at $200,000, with a five year benchmark of $500,000.

 

[boeingdriver213]

I keep hearing 787s. Are you kidding me? Maybe a 737 sized 787, but we will NEVER have 787s. That is not who we are, or what we do. You want to fly BIG airplanes, you're gonna have to go somewhere else...

 

[Scope out RJ's]

I keep hearing 787s. Are you kidding me? Maybe a 737 sized 787, but we will NEVER have 787s. That is not who we are, or what we do. You want to fly BIG airplanes, you're gonna have to go somewhere else...

No kidding. Can you imagine what the PFT would be for a 787 type rating?:laugh::laugh:

 

[Saluki Dawg]

We also don't fly to Airports like LGA, PHL, and BOS either, we're Southwest Airlines after all and that's not what we do. We also will never attempt to buy another Airline with a different fleet type either, not Southwest Airlines. When it comes to what GK will or won't do, there is absolutely nothing that would surprise me including flying far International with 787's if he thinks we can make a solid buck doing it.

 

[Richard Gozinya]

SWA and Paulding Co airport... never gonna happen.

With our new Climb2 profile, we should be able to do it!

 

[Cruncher]

Since a 73 sized 78 looses most of the benefits of the 78's large wing, Boeing will never make it. SWA will eventually have to replace their 73, their final options expire in 2018, so they have time to figure that out. Boeing may select a more efficient engine on their NGs and decide to make them for another couple decades (I can't find any concrete proof that Boeing plans on terminating their 73 line, send a link if I am wrong). If SWA wants a higher capacity airplane, they'd probably go the route of the -800 / 900ER (maintaining their single type rating & more importantly thier single "training" curriculums for their flight crews). I think the -900 would do them well in the LGA / BOS / high density markets. A -900ER costs about 33% more, but carriers 42% more passengers (single config, 32" pitch). It fits in most system gates, flies transcon and almost doubles cargo capacity. As a side note, higher density airplanes do NOT necessarily increase the pilot seniority list, so be careful what you wish for. SWA does have the option of substituting the -700 for a -6/800, but must give 18 months notice, so unless they are hush about it, it won't happen for awhile.

If the "new" business model of high oil prices is here to stay, I would not be surprised to see a shift to higher density airplanes. We've seen that with the smaller RJ manufactures. Airlines can NOT grow out of higher fuel CASM, fleet growth does lower average salaries (with new hires), but it does not offset extra fuel costs. $80 oil is a tough pill to swallow, but made easier with enormous load factors! These high LF may eventually lead to a -800 / 900ER model that works with an quasi-aggressive growth plan.

GK is very conservative (some say "Gloom & Doom Gary"), but has anyone listened / read the '09 Q4 earnings call. He's "cautiously optimistic" about 2010, but ...

Most probably scenario: 2010 is flat. We will add the N FL "Beaches" airport and maybe 1 or 2 other cities (swag). Pick up 10 new airplanes, but retire / give back expiring leases. Jan & Feb (scheduled) are behind us, but lines will improve in 2nd/3rd qtr, and will be a little higher than yoy. So any unplanned growth will not be scheduled very efficiently, which I read as "not gonna happen," at least in the 1st half of the year. That being said, GK said he does not have to retire the 10 a/c mentioned above and he could go into the "resell" market to surge if conditions warrant. BEST case, is a 20 plane growth in 2010 from our Jan schedule (511 scheduled but 535 on the books), however this scenario is highly unlikely, considering employment #s and economy in general!

GK is working on improving the balance sheet in 2010, so I don't see a huge outlay of capital this year. But we do have 2.6 billion in cash and short term investments, so the potential is there to go on a buying spree. Currently we are leveraged around 45%, and GK is comfortable with this level as it still maintains our investment grade status in the bond market.

GK wishes he could add to LGA (no gates or slots to be had in LGA; no cabotage from ISP is great to hear) but instead is focusing intensely in DEN, 144 flights per day in August and to a lesser extent in STL.

The WestJet & Volaris codeshares ;-( should start later this year, but I have not heard anything solid yet (read: no advertising for the summer months and this is where I'd expect to see a push / ad campaign), so we'll see how this goes. GK does intend to eventually fly near international with our own metal, but not likely in 2010 or 2011 or that matter.

Sorry if that got a little "investment" for your question. I do not see a lot of growth this year, but I would love to see us end '10 with 560 planes, at least 4 added cities , and an expansion of our current network (more non-stops). The permutation of each new city has the potential to drastically increase our city pairs (and our schedules).

I do not see us merging with Alaska, Airtran or anyone for that matter, save the chp 7 fire sale (which I do not see happening unless we see a double dip, employment #s sag more, and the credit markets tighten up again).

Sun Country is an interesting case though. I don't know their product well enough to speculate, ahhh but what the heck. What is 9 a/c, some seasonal service worth? GK may see this as a large -800 buy up front to increase our ASM from the high density cities. Caribbean presence, ANK, could trade JFK for LGA, ..., but who knows.

This is probably too long for most to read, and of course this is just one line pilot's opinion.

 

[ultrarunner]

..Two isles = faster boarding/

Two isles? Whatever you smoking Hose, pass that pipe!

two isles.....


THAT cracks me up!

 

[Whataburger]

looking the weight limit at the airport, I dont know if that is a structural limitation or a policy for longevity of the airport, but anyway 90K lbs aint gonna work

the Skywest purchase will take care of that.

 

[waveflyer]

Let's not prove the saying that pilots are the stupidest smart-people on the planet-
we will know when we should know- not a minute sooner and probably a week or so later than we'd like.
IMO - 787's could happen- likely even
I don't covet it- if the -200's were the best a/c for the job- I'd hope to still have them- I just think our passengers would enjoy it more on the transcons and it makes sense out of slot restricted bigger markets- esp competing against VA/JBlu products- depends on the numbers- it's like bag fees - how many people choose jblu or virgin bc they don't want to be in a 73 for that long? Gary will know-

Ok- hasn't been addressed- san Juan? Multiple say it's a no brainer/ done deal/ in the papers- old news.... Guess I'm out of touch...but I'd love it

 

[gobyebye]

We have a pulse point questionaire on our employee website and it currently asks which NFL team is the farthest from a current SWA city. The choices are Atlanta Falcons, Miami Dolphins, Carolina Panthers, and Cincinnati Bengals. Hmmmm......These cities seem to be the ones on the rumor mill as well. Maybe a little insight tease from mgmt?


P.S. Answer: Panthers

 

[CFI2766]

Finding some space at Dobbins would make a LOT more sense than starting from scratch at Paulding county.

I believe that creating a terminal just for one airline, which is what would happen if SWA were to attempt the ATL market from somewhere other than KATL, would be prohibitively expensive.

Also, it would be expensive to get the city of ATL to support SWA, something that DAL would fight. Not to say that it couldn't be done, but it would be expensive.

 

[Saluki Dawg]

We have a pulse point questionaire on our employee website and it currently asks which NFL team is the farthest from a current SWA city. The choices are Atlanta Falcons, Miami Dolphins, Carolina Panthers, and Cincinnati Bengals. Hmmmm......These cities seem to be the ones on the rumor mill as well. Maybe a little insight tease from mgmt?


P.S. Answer: Panthers

I think you may have broken the code! Let's see if they announce CLT at the PHX MTF tonight.

 

[Cruncher]

Wave, I could not have said your first sentence any better, anytime I open my mouth I prove such beliefs .... But what the heck, lemme put on my community college MBA hat:


City growth:
Atlanta area (busiest domestic O/D traffic in the US),
Cincinnati (one of the highest fare cities in the US),
Charlotte (financial capital of the US - well it used to be),
DCA (Face it, we really do NOT serve our nation's capital; IAD, BWI are close but it's a pain to get to downtown, and does not offset the TIME & cost in traveling / driving once you land),
San Juan (enormous PR population / US territory; could also feed our inter-island code share partner ;-(,
ANK (bet AS makes a killing on cargo alone),
Richmond, VA (driving to DC to fly out is non-option! ORF is not much better)
Memphis,
Charleston,
Greenville-Spartanburg, ...

there are many great places to choose from. If the "Beaches" experiment works this year, we may see a lot more of these places in 2011/12. IMHO.

Aircraft growth:
Assume our 73 operation as the core engine of the "new" business model, here is how we can grow again (new business model = $80+ oil going forward):

1) Not all American cities can support 737-sized scheduled air service; however, a Q400 (or something of similar size, comfort, range/performance cost factor, ...) can be used to (dare I say) feed our network &/or support a new short range market in and of itself. (how many through passengers do you regularly). This a/c can also be used on highly variable LF seasonal markets (read: Mexican / Caribbean / ski / beach destinations, ...). We could add places like Fresno, Vail, the near islands, Cabo, & Monterrey (both or them for that matter). The threat here is cannibalization of 737 segments (think of all the segments that [used to] run half empty certain times of the year, AMA, LBB, ...). Probably have Q segments heavily built around 737 domiciles, LAX, SLC, DEN, ... but could add many smaller new markets.

2) 737 continues with the current operation with the ability to supplement / surge on Q400 routes daily, weekly, monthly, or quarterly as travel demand warrants. This core operation would probably not grow as fast going forward, at least initially, as company growth happens on the feeder network (there's that word again).

3) A high capacity aircraft used on slot limited / high density routes. IMHO, as an industry going forward this needs to be our end state. Congress & the WH are already trying to run our entire life now, wait until we have another weather breakdown in the aviation world?! If GK decides he wants to fly our own metal on long range international destinations, then yea, a 787 is probably in our future. However, I honestly do not think GK is putting many man-hours into this arena, at least not in the near (5-year) term (I like to see how the Frequent Flyer program "changes" this year though). So in the high density / short haul / US only market, the 787 is probably not "worth" it for us right now (today). The 787 advertises 20% operational efficiency over "comparable sized" aircraft. However, comparing the (non-comparable sized aircraft) -700 to the 787-300 (from Boeing's website and a swag wrt to single-configuration 32" pitch seating capacity) results: +250% $$ increase in a/c cost alone (not to include training, maintenance ...), but only +215% pax load capability. I am not sure if the 787-3 operational CASM makes up the difference vs the 737-700 (for us now). As a comparison, a 737-900 costs only 33% more, but adds 42% more pax capability and comes with all the benefits of a single type, training, they can park at most of our gates, .... The latest 10K statement mentions an option to exchange -700 options for -6/800 aircraft (I don't remember it there last year, but I could be wrong).

There are many positives with the above: one SWA Master Pilot Seniority List! We control our product, no offense to anyone. Lower cost associated by growing by hiring, none of the issues with mergers / acquisitions, .... We could easily add 50 cities to our network in 10-15 years.

Though there are many risks, a few that come to mind (not an inclusive list): First and foremost, it deviates considerably from the business model that has made SWA profitable for the last 37 years; the stock market may not view this too favorably, at least not in the near term! Second, the added costs associated with purchasing different aircraft, & aircrew training alone is considerable and probably a non-starter. Lastly, aircraft scheduling will not nearly be as easy as it is today (probably see a lot more 35+ scheduled turn times waiting on connections); flight attendant/pilot flow will be a cluster during weather / maintenance "events." You & I both know, HQ will need to figure this "new" operation out themselves, vice hiring someone who has done this for decades. The learning curve will be steep & growing pains deep.

... sorry to get so long, home sick today, going back to bed.

 

[Cruncher]

Alright, had to look it up. The -6/800 options were on the 2008 10k statement.

http://yahoo.brand.edgar-online.com...panyid=9327&ppu=%2fdefault.aspx%3fcik%3d92380

pg 53

 

[PropPiedmont]

I think you may have broken the code! Let's see if they announce CLT at the PHX MTF tonight.

Do they usually break news at the MTFs? I thought it was just a rally the troops kind of thing.

It'd be nice if they announced a new city at each one of the MTFs this year.