General Lee
Well-known member
- Joined
- Aug 24, 2002
- Posts
- 20,442
I think the General is just pissed because he see's his upgrade slipping ever further away.
On the DC9? I can't wait......
Bye Bye--General Lee
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I think the General is just pissed because he see's his upgrade slipping ever further away.
You skywest guys are such a bunch of ****************************************....
goddamn you pilots for passing the cost of fuel to Delta!!! the shame...the horror...how do you guys sleep at night.
(god i hope the humor comes across here).
thanks again GL for mentioning me on the 10k post. have gotten a bunch of atta boyz from my homeys for that one...
Mookie
On the DC9? I can't wait......
Bye Bye--General Lee
Did you just graduate from Empty Nipple?
Bye Bye--General Lee
Two Words
$100 Oil
It's Re-Engineer-The-Business Time...
On An Emergency Basis
[FONT=Tahoma, verdana, lucida]Sector One: Small Lift Providers[/FONT]
[FONT=Tahoma, verdana, lucida]Say Good-Bye To A Lot of Regional Jets, Real Soon. [/FONT]
[FONT=Tahoma, verdana, lucida]Fuel Pass-Throughs Will Pass Them Directly To The Desert[/FONT]
[FONT=Tahoma, verdana, lucida]It should be back-to-the-drawing-board time for small lift providers, what some still call "regional airlines." Maybe time for a period of sheer panic, too. The issue: 50-seat and smaller RJs are being economically marginalized by skyrocketing fuel costs. [/FONT]
[FONT=Tahoma, verdana, lucida]Major carriers will be looking to quickly cull out dozens of RJs in the coming months. And hundreds more in the next five years, with no replacement for this lift - or many of the markets they operate - in sight.[/FONT]
[FONT=Tahoma, verdana, lucida]Most SLP agreements provide for fuel costs to be a pure pass-through to the major carrier, and that means the majors are eating a lot of red ink. A lot of RJ mission applications that once provided adequate revenue generation are now net drains on major airline systems. They cannot but move quickly to restructure (read: reduce) the fleets of RJs they're leasing in.[/FONT]
[FONT=Tahoma, verdana, lucida]Faster Retirements Than Predicted.[/FONT]
[FONT=Tahoma, verdana, lucida][FONT=Tahoma, verdana, lucida]Now, with oil hovering at $100 a barrel, that forecast has been revised. The retirement projections are for over 1,700 RJs to come out of fleets for the same ten year period, with the rate front-loaded in the 2008 - 2013 period, representing approximately 835 RJs taken out of service in the US alone. [/FONT]
[FONT=Tahoma, verdana, lucida]The net-new figure represents larger CRJs (mostly -900s) coming into SLP fleets to replace 50-seat -200s. But even here, there isn't a whole lot of demand going forward. There are no new-generation <70 seaters on the horizon to replace the current fleet of 50-seat and smaller RJs. That means new fleet mixes.[/FONT]
[FONT=Tahoma, verdana, lucida]It also means fundamentally-revised airline route systems.[/FONT]
[FONT=Tahoma, verdana, lucida][FONT=Tahoma, verdana, lucida]Late Night Oil Burning In The Planning Department. As we speak, planning departments at comprehensive network carriers are in full metal jacket status, working to moderate the level of financial drain smaller RJs are inflicting on their systems. [/FONT]
[FONT=Tahoma, verdana, lucida]Legal departments are working, too, reviewing current service agreements with SLPs. Most contracts are relatively long-term - to 2013 or beyond. The problem is that there is no way that the current number of these RJs can be supported until then with jet-A heading to $3 a gallon and up. Culling the herd in is the cards.[/FONT]
[FONT=Tahoma, verdana, lucida]Many agreements contain an early-out provision for the CNC, where a six-month notice can be given. In most cases, however, these notice dates don't become effective until late 2008 or 2009, and majors cannot afford to wait that long to cut RJ lift. So that means doing some deals with current SLPs. A cash payment in exchange for an early-out. Renegotiating the agreement with a financial incentive for the SLP to shift to larger CRJs or even into E-Jets, depending on the status of scope clauses at the CNC.[/FONT]
[FONT=Tahoma, verdana, lucida]Small Lift Providers To Watch. Clearly, 50-seaters are in the economic cross-hairs. And any jet airliner smaller than that is just marking time 'til the grim-reaper comes to take it to the Budweiser plant. So the question arises regarding how the SLP sector will survive.[/FONT]
[FONT=Tahoma, verdana, lucida]The hard reality is that the SLP sector will be shrinking markedly over the next three years. Hard fact: there are more 50-seat jets than can be economically flown. Hard fact: that means cutbacks in the number of operators.[/FONT]
[FONT=Tahoma, verdana, lucida]SLPs must move to hasten their fleet migration into larger CRJs or, better, into the Embraer E-Jet platform. But that means bigger units of capacity, higher sector costs, and, ergo, fewer markets where such aircraft can operate compared to what 50-seaters could do before the price of jet-A headed toward the Moon.[/FONT]
[FONT=Tahoma, verdana, lucida]The first option - larger CRJs - will provide better per-seat economics for the CNC customer, and for CRJ-200 operators, a relatively painless shift. But it's still an RJ, and with more seats and higher sector costs, it won't do much for the communities that are in line to see loss of service as the 50-seat cost bar goes up and CNCs cut flights. [/FONT]
[/FONT][/FONT]
Bye Bye--General Lee
For all of your computer 'prowess', I'm surprised you missed this reference to the cultural phenomenon known as AYB. Google 'All Your Base Are Belong to Us' and enlighten yourself.
PS...I don't think the consumer is going to give up frequency for 2 flights a day in your soon-to-be MD90s from China. Not sure Dothan or Brunswick will ever support that. What do you propose then...?
How do we reduce frequency without leaving a market? We put a mainline plane in there twice a day, and take out 5 RJs. We squeeze everyone on two flights
There 76 seat pay rates remember