Trouble ahead for Low Cost Carriers???

[delivery100]

Quick off topic question for you General.

You appear to have posted close to 1500 posts on this website... and do spend ALOT of time here..... so.... have you contributed to the forum fundraiser?

If not, what is your position on contributing?

Just curious.

Thats a real intelligent and well thought of post. Try to ridicule someone in the middle of a thread by asking there position on donating to this website. Maybe the General chooses to donate his time and money in other ways. Either way, in my opinion, its really none of your buisness and not at all an appropriate response to any posts on this thread.

 

[Skank]

Once again General Lee has hijacked an entire thread, this time one that he started, no less. General Lee for President! Wait, I don't like the sound of that.
You know General, in retirement you're going to drive your wife crazy.

 

[General Lee]

Skank,

I already do!! She has threatened to take the computer away when I am on trips. And my laptop is an older version that has been acting up lately, so I have to becareful and do what she says MOST OF THE TIME. I also know that she likes jewels.....And, if you do vote for me for President, the first thing I will do for you Jetblue guys is to raise the daily FAR hour flying limit to 13 hours perday---so you can do JFK-LGB-JFK-FLL in one day! Think about it, you will only have to fly 7 days a month!!! Vote for the General!!!!

Jetblue320,

Sorry about that. There is another guy who is a new Jetblue hire that was furloughed from us and I got you guys mixed up. A lot of my Jetblue banter is to "rib" you guys a bit, no hard feelings though. But I do know that you guys are jealous when you see our lime green Song 757s---right??? Take care.

Bye Bye--General Lee

 

[FL717]

Thats a real intelligent and well thought of post. Try to ridicule someone in the middle of a thread by asking there position on donating to this website. Maybe the General chooses to donate his time and money in other ways. Either way, in my opinion, its really none of your buisness and not at all an appropriate response to any posts on this thread.

My question was to General Lee. I do not remember asking you anything. Why must you feel the need to comment and attack??

Also... what was/is the intent of my question to General Lee?? I do not remember stating the intent, so you can only assume the intent... and I can assure you your assumption is incorrect.

As far as what is my business, or none of my business, General Lee is a big boy, and he can decide for himself what is my business by electing to answer my query or not. He politely answered and therefore his and my dialogue are quite frankly... none of your business.

Bu-Bye.

 

[T-Bags]

Ah the old "can't dispute the point so attack the poster" AT game....nice....

Just to clear up a few points. F9, you'll be glad to hear the data comes from DALs quarterly report....

As evil as Wolf was, he understood one very important aspect of the airline industry. to lower costs, you MUST grow. Lets consider DAL.

3rd Q operating CASM in cents(admittedly rough and includes WO's)

Labor 4.5
fuel 1.4
depreciation .9
contracted service .6
landing fee's and rents .6
maint materials .5
jet rent .5
other pax and selling expenses 1.2
total 10.2

Now lets consider what DALs costs will be as they grow RPM's over the next year or so WITHOUT cutting salaries

Labor 3.5 (currently overmanned, probably an OVERESTIMATE)
fuel 1.4
contracted serv .6
landing fees and rent .5 (already renting gates, only landing fees go up)
maint materials .5 (probably high estimate, jets break less when flown)
other pax and selling expenses 1.0 (infrastructure already there prob overestimate)
total 7.5

As DAL adds flights, it will do so at a cost LOWER than AAI's (assuming it is done with the existing fleet, safe bet considering capacity in 2000...). The LCC's capitalized on the attempts by the legacy carriers to cut back capacity by "cartel cheating". Smart move and the appropriate action under game theory. But consider what is now happening. JBlu is announcing that RASM is going DOWN, while it is GOING UP and the legacy carriers. So not only will they have lower costs for the additional ASM, they'll also get HIGHER yields. as the financial strength of the majors increases (as evidenced by POSITIVE cash flows), they will likely be MUCH more agressive in the battle for market share.

One quick note about international travel. The US carriers were on the losing end BIG TIME during the 90's with respect to international market share. this was IMHO primarily due to the strength of the dollar. 2 years ago it took approx $1.20 Euros to buy $1.00 US. today the opposite is true. due to changes in exchange rates and other cost cutting initiatives, UAL now has the second LOWEST trans atlantic CASM of all the Star partners (behind Polish LOT...), down from the HIGHEST two years ago. I've got a pretty strong suspision that DAL's costs are now LOWER than AF's. The only thing keeping the pax away are lingering (and hopefully fading) terrorism fears, and weakness in the US economy (folks like to fly their own country's carrier...). As to the LCC's flying the Atlantic, I just about broke a rib laughing... With the exception of ATA, the biggest jet flown by the LCC's is an A320. You telling me you gonna add some "big iron' for a once a day flight? You gonna incur the additional expense of ETOPS Mx (hard to farm that out to mobile...)? You gonna add the complexity of a hub and spoke system to feed the flight? You gonna add the training expense of a new specialized fleet? You gonna buy slots at the major int gateways? Pay NAT fees? How about a first and business class for the 8 hour minimum flight?

 

[FDJ2]

Then I asked a good question about what will happen when there are LCCs overlapping, and I get "gang banged" by a SW and Jetblue guy. Bye Bye---General Lee

General,that's because they think you just took a t*&d in their kool aid. These guys can't handle the fact that they too are subject to competition and might one day have a management team that is not so seemingly benevolent. History is cruel to start ups like JBLU and SWA is beginning to look a little stale and is showing signs of increasing labor strife. Sure the legacy carriers have taken it on the chin these last two years, but we all know the cyclical nature of the industry. While pilot costs are a factor, the business model at the legacy carriers does not revolve around pilot costs. The hub spoke system demands a large and mature network and is still the most efficient means of serving the majority of destinations around the world. While SWA and JBLU may only serve 58 and 22 destinations respectively, DAL serves over 419.

 

[OakRBust]

Step away from the crack pipe...

Sure SWA is subject to competition but... A START UP


Come on.....

 

[Ty Webb]

Spoken like a true dinosaur . . . . . How many destinations did Pan Am serve? TWA? Eastern?

It's not about how many you serve, it's about the bottom line . . . . and the bottom line is the "start ups" as you call them are making money- something DAL has yet to do in the millenium.

I would be willing to bet that in the 25 years they've been in existence, SWA has made more money for its shareholders than DAl has in 75.


History is cruel to start ups like JBLU and SWA is beginning to look a little stale and is showing signs of increasing labor strife.

This would be laughable if it weren;t so pathetic. "Labor strife" at SWA means the FA's want to be paid industry standard. . . . . that's a far cry from strife.

You're gonna have to better than that, FDJ2.

 

[T-Bags]

No Ty, labor strife at SWA means that SWA management REFUSES to pay it's flight attendants industry average.... The same will happen at Jetblue, and has been modus at ValuJet (AT) since day one.

 

[T-Bags]

Step away from the crack pipe...

Sure SWA is subject to competition but... A START UP


Come on.....

Read again SLOWLY. FD said "JBLU was a startup", then said "AND SWA is starting to look stale....."