A Squared
Well-known member
- Joined
- Nov 26, 2001
- Posts
- 3,006
coolyokeluke said:And TiredofTeaching, you pointed out SW is successful in the present environment but neglected to note that they would not be if they weren't hedged.
yes, but the point is that they DID hedge, and they are making money, and other airlines, run with less foresight are not making money.
Workin'Stiff said:Thats great that those companies are very fortunate in their current business practices. However, even comparing Southwest to any of the legacy carriers is like comparing apples to oranges. Southwest has always concentrated on keeping fares low and providing service within the US. The legacy carriers have expanded their reach to surround the globe and provided several levels of service such as coach, first, and business classes. That type of operation is vastly different than Southwest. So it is truely unfair to compare the two based on the fact they have night and day business models.
No it is not an apples to oranges comprison, it is as direct and as vadid comparison as could possibly be made. Southwest and the legacy carriers are both in the buisness of selling air transoprtation. Southwest uses a business model which works, and the legacy carriers use a business model which *doesn't* work. That it the whole point. The legacy model doesn't work, Southwest's does. You can talk all you want about global reach and various levels of service, but at the end of the day, thier business model isn't working, and Southwest's model *IS* working. For whatever reason the legacy carriers are clinging to a business model which is pretty clearly not workable, yet we keep propping them up and letting them stagger on.
Wasted said:It has allowed some companies to cherry pick while disallowing true competition.
No actually "cherry picking" as you put it is a fundamental element of competition, enter the markets which are profitable, don't enter those which are not. It's not some insidious evil, like scabbing or prostituting your sister, it's sound business practice, which the legacy carriers are not practicing. If "cherry picking" certain markets puts the legacy carriers in jeporady because it takes away revuene they need to sustain unprofitable routes, the question must be asked, "why are they flying those unprofitable routes?"
It's like a legacy sunscreen retailer complaing becuse some new upstart sunscreen retailer is "cherry picking" the lucrative florida and arizona sunsscreen markets, leaving them with the losses from thier unprofitable Ketchikan, Alaska sunscreen store (it rains 476 days in an average year in Ketchikan )
Hello, why on earth are you selling sunscreen in ketchikan whey you can't make money doing it???????? The problem is not the new upstart sunscreen retailers "cherry picking" in Miami and Phoenix, the problem is the business model which has you keeping a sunscereen store open in ketchikan which never sees the sun.
Maybe the key is to close your Ketchikan store and concentrate on being competitive in the sun belt, where the market is.