Who wants Airtran?

[bugchaser]

Everyone is an LCC thanks to our governments protection of everything and anything that even smells of LCC

Wow, what an ignorant post. Looks to me like the gov has been guilty of saving the arse of several airlines, but if I recall they have been legacy type carriers. If the gov would have stayed out of things and not bailed out some of the weak, we would not be in this mess right now. The legacies have a faulty business plan and cannot survive in their current state. After one or more of them are allowed to fail, we can all get on with things. LCC's are not the problem. Sorry if all that seems cold or uncaring, but it is the truth.

 

[Wheres the van?]

At some point in the future a Legacy leader not just a CEO will realise that they are siphoning off a large amount of there international profits competing for domestic feed.That CEO might realise that instead of paying for capacity agreements with substandard regional outfits that a capacity agreement with say for example Airtran in ATL would half the costs of there domestic feed cause across the board improvement in ontime,baggage and passenger experiance and create a highly profitable international airline capable of competing with the LH,SQ and BAs of this world.

This sort of out of the box thinking would allow a for example Delta to compete unincumbered on the international scene.Not to mention the benefit of non competes on the domestic scene.

This may or may not happen,but for know let us enjoy facing off against each other in the penalty box 717 against CRJ/ERJ waiting for that much coveted release for ATL.You may say Im a dreamer but Im not the only one.

 

[FlyinGuy]

Hey pipe, just think of how the LCC's could expand if all the majors were allowed to disolve?

 

[airline#5]

Thanks. My wife and kids appreciate your good wishes for our future success...

Funny,my wife and kids would love to see AT go down the tubes. We're all getting tired of this trailer. "Go get a real job, Daddy" Makes a man feel proud these FO wages. $hit, my kid drank the last 40.

 

[Lear70]

It's also a two-edged sword. LCC's offer lower fares, but Legacies respond by "dumping seats" into the marketplace to try to "hold on to market share". That keeps the price low.

Pensacola (FL) is a textbook example. Before AirTran began service, Delta offered 4 or 5 flights a day, half of them RJ, the rest DC9 or MD80.

Now, Delta has 8 flights a day; a 757, MD88, 737-800's and maybe one RJ . . . .

I think AirTran could probably raise their fares out of Pensacola, except for all the "excess capacity" in that market, courtesy of Delta trying to "hold on to market share".

If you can't serve that passenger at the going price, and still make a profit, it ain't your market to keep.

Egggzactly right.

This is the type of legislation I'm talking about. An airline should not be allowed to price their product below what it costs to produce it for longer than a short period of time to "stimulate a NEW market".

If a LCC entrant can prove they can operate that segment at a profit with that reduced fare, then they get to keep doing it. If the Legacy can't stay profitable, they have to get out.

There IS room for both a Legacy and a LCC in a city because they serve a different market segment. Southwest has PROVEN time and time again that they actually INCREASE the number of passengers that will fly out of a city they serve because the price point becomes affordable to a whole new group of people. Of course they will take SOME of the Legacy passengers and might force a Legacy price correction, but that's not the problem.

The PROBLEM is that the Legacy will then FLOOD the market with more seats, match the LCC price, just in an attempt to "protect their turf". 20 years of this nonsense and the Legacies STILL haven't figured out they can't do this.

There ARE several reasons a passenger would pay a higher price for the same ticket:

1. They're going to connect internationally,
2. The service is better on the Legacy than the LCC, or
3. They want the points for the frequent flyer program so they can go internationally when they take a vacation on their points.

That's it. Period. That was the WHOLE POINT of deregulation; let the carriers compete on SERVICE and may the best carrier win. The problem is that they didn't set a safety net in place to prevent the Legacies from operating at a loss long-term because they never DREAMED the carriers would operate in the negative, go bankrupt, dump millions of dollars of debt on the taxpayers and their contractors, then come back in AND DO IT ALL OVER AGAIN.

THAT'S what the Legacies should be concentrating on. Make your product so much better than the LCC's that you CAN charge $30-$50 more per ticket and stay profitable.

Let the LCC's have their low-fare market, keep a decent share of the business traveler and higher-end traveler in that market, and go on about your business.

You can't blame it all on the LCC when management at the Legacy keeps doing the same thing (increased frequency and below-cost prices) and expects different results. That is, incidentally, the definition of insanity...

 

[Ty Webb]

Lear, you summed it up perfectly. Better slap a copyright on that post, before Ray Neidl or Jim Cramer steal it. . . . .

 

[pipejockey]

Sorry pal,
Ask the kind people traveling out of Charleston what kind of ticket prices they were paying before AirTran stared service and what kind of prices they are paying today? Ask the traveling public what kind of prices they are paying out of Cincinnati?

I don't have to ask, I already know! They were paying a ticket price that was more than reasonable, a ticket price that if paid nationwide might allow the airlines to start turning profits and in turn start paying us an income that would give us 80's or early 90s earning power again. Even if it meant 10% of the flying public would be put out of the game, so be it!! It sounds like you condone these horrific ticket prices going around these days. Whats the matter with you people. Flying is privilege not a right!

 

[FlyFastLiveSlow]

Funny,my wife and kids would love to see AT go down the tubes. We're all getting tired of this trailer. "Go get a real job, Daddy" Makes a man feel proud these FO wages. $hit, my kid drank the last 40.

I REAAAAALLLLY wish you would just quit.

 

[PCL_128]

I REAAAAALLLLY wish you would just quit.

I'm with ya.

 

[jehtplane]

Wow, what an ignorant post. Looks to me like the gov has been guilty of saving the arse of several airlines, but if I recall they have been legacy type carriers. If the gov would have stayed out of things and not bailed out some of the weak, we would not be in this mess right now. The legacies have a faulty business plan and cannot survive in their current state. After one or more of them are allowed to fail, we can all get on with things. LCC's are not the problem. Sorry if all that seems cold or uncaring, but it is the truth.

Nice Avatar. Air Tractor, there is no substitute...

 

[Lowrider717]

Egggzactly right.

Make your product so much better than the LCC's that you CAN charge $30-$50 more per ticket and stay profitable.

Let the LCC's have their low-fare market, keep a decent share of the business traveler and higher-end traveler in that market, and go on about your business.

...

This was the model prior to 9/11. Then in one day it all changed.

 

[CatfishVT9]

Not so fast my friend.

Another example: When Airtran announced service to LA and SFO, Delta added 4 additional 767 flights to those destinations. Another 1000 folks needed to fly there every day day? I don't think so.

What year? 2003

 

[FL_Jumpseat]

From the Burlington Free Press on 5/2/08:

Merger talks have become increasingly common in the U.S. airline industry, but Fornaro said AirTran has no interest in merging with another airline.

"Most of those larger carriers are just too big ... so they have to do something about it," he said, noting that after consolidation redundant capacity is eliminated. "We, and a handful of others, can go it alone."

If the price of oil continues to sell for nearly $120 a barrel, the industry will adapt by reducing capacity and, eventually, raising fares. "It doesn't happen in a week or a month. It happens over time," Fornaro said.

 

[PCL_128]

I hope he's right. Going it alone is by far my first choice. I just wonder whether we can really make it work if consolidation goes widespread and we end up smaller than just about everybody else. Time will tell.