WS took delivery of a 737-600 this afternoon.

WS took delivery of a 737-600 this afternoon.

One of the few airlines bothering to do so.

One of the few airlines bothering to do so.

You'd understand why WJ bothers to do so if you saw how the operating economics of a -600 blow away those of the E180 in Canada.....they are not even in the same ball park.
:D :D :D

You'd understand why WJ bothers to do so if you saw how the operating economics of a -600 blow away those of the E180 in Canada.....they are not even in the same ball park.
:D :D :D
(e190s)

You'd understand why WJ bothers to do so if you saw how the operating economics of a -600 blow away those of the E180 in Canada.....they are not even in the same ball park.
:D :D :D

Uhu huh sure. I'm sure Embraer has beaten a path to your door with all the relevant info. Since WS is Boeing's best customer I'm sure they were all to happy to sell you this porker.

the bigwigs have in fact been telling us that the -600 is cheaper to operate than the -700. Good enough for me. And hey, if we are the first customer to put winglets on them, it can only get better.

the bigwigs have in fact been telling us that the -600 is cheaper to operate than the -700. Good enough for me. And hey, if we are the first customer to put winglets on them, it can only get better.
What if the winglets make no economic sense?

(e190s)


E180's.

Push back, taxi out, mechanical issue, 180 back to the gate.

;)

EMB was in Calgary with a 175 long before they or the 190's were a glint in ACE's eye. The economics don't work in Canada for reasons that I have already explained.

Their unit costs are too high for profitable low fare flying and they don't work well on longer haul runs, or high utilization, long haul flying.

As long as those are are not important to you, they aren't a bad airplane. Problem is, AC are trying to use them in low fare flying, just like they tried to use the CRJ's for low fare flying. They don't work well unless you can get 14 hours a day out of them, and they are not designed for that.

However, they are better suited in high density environments, like the US NE corridor, where core flying starts at 6:00am and ends at midnight and there's no need to operate redeye or 2,500 mile charter missions.

Ya get it, yet? ;)

the bigwigs have in fact been telling us that the -600 is cheaper to operate than the -700. Good enough for me. And hey, if we are the first customer to put winglets on them, it can only get better.

The BigWigs are also telling you, you will make more money by working for less money.

What if the winglets make no economic sense?
how could it not make sense? An average 4% savings is huge on the 700 and 800's, why would the 600 be any different?

Because the 600s aren't exactly the same as the 700 and 800s. They have slight modifications to them.

OMG! They're SLIGHTLY modified! Well, then screw the winglets, they'd be a waste of money!!! :rolleyes:

Well, they may very well be. Unless if you're an aerospace engineer, keep the :rolleyes: to yourself. I have no clue if the addition of any wingtips give any savings or not, but I'm pointing out that the 600 design is slightly modified which may very well change things. After all, if the wingtips can give a 4% savings, they could also potentially give a 4% addition to cost.

It's like saying that bolts and nuts from product A will fit in product B because it is only a slight modification of product A. Not necessarily. Example? Power bars for laptops. I have three Dell laptops at home. The power adapter from my Dell does not work in my sister's or dad's Dells. They are all slightly modified and there are "consequences".

And I guess your attitude of "if the bigwigs say it's ok, then it's ok" is the same as saying, "I'm a lemming. I don't question. I just do as my masters wish. Their wish is my command." This of course is fine and dandy if that is what you want.

After all, if the wingtips can give a 4% savings, they could also potentially give a 4% addition to cost.

When Westjet added its first set of winglets it had that aircraft operate for 30 days to study the fuel savings. On shorter legs (such as BC-Alberta) the effect was minute but the savings were more noticable on flights over (if memory is correct) 2.25 hours. The 4% average was just that - an average. Sometimes the savings were higher (up to 6%) and sometimes lower.. Being that the 737-600 is the same type of aircraft as the -700/-800 only shorter I don't see why winglets wouldn't work... unless the shorter fuselage hinders any savings.

I don't disagree with you. This is in essense what I am saying.

I'm just pointing out to 4-1 OH! that potential remote possibility. But instead, he cannot rebutt with something similar to what you've said.

I'm not going to state it as a plain fact, but I don't think Boeing would be bothering with a -600 winglet if there wasn't a cost benefit to them. I haven't read about any winglet that has turned out to add operating cost, although I don't think they would work on every type of plane (C172 for example).

....and it is not a cheap shot!

Why is it that the 600 series is called by some a flying pig? Or is it just the Airbus-Boeing bunfights?

...And I guess your attitude of "if the bigwigs say it's ok, then it's ok" is the same as saying, "I'm a lemming. I don't question. I just do as my masters wish. Their wish is my command." This of course is fine and dandy if that is what you want.

Just shut up and drink your Kool-Aid, as they say in Kliveworld :D

....and it is not a cheap shot!

Why is it that the 600 series is called by some a flying pig? Or is it just the Airbus-Boeing bunfights?

I guess you have to ask who calls it a "flying pig". Cur? Simon? Parnel? YOWKid? This is the gang that assess airline profitability by counting cars in airport parking lots.

The -600 is the same size as the -200, which was one of the best selling airframes of all time.

It is a dramatically upgraded version of the -500, which was basically a reengined -200. More thrust, but virtually no changes in the airframe, resulting in a lot of issues showing up much earlier in their life span compared to the -200's. CanJet is going to have to deal with these expensive issues very soon, if not already.

The -600 has a different wing, and other differences that add weight to the airframe, but also make it much, much more durable and provide much better longer term maintenance economics. The engines are far more efficient than the -300 / 400 / 500 neo-classics.

There are not many aircraft that can operate 200 to 3,000 mile sectors with 117 passengers comfortably, and with reliability. Certainly not the EMB's. They are best used on missions up to about 1,200 miles. Tuff to get 14 hours a day out of them.

Then there's the economics. Don't think for a second that Boeing doesn't realize the 117 seat - 600 is a competitor of the EMB's and isn't pricing them accordingly. That's far better business than having to create a new 100 seat aircraft from scratch. Huge, huge bucks.

Add the advantages of a single aircraft type, where every airframe in the fleet is interchangable, training costs are dramatically lower, maintenance costs from a common fleet are lower, every pilot and every flight attendant can work any aircraft at any time, the simplicity and efficiency of a single flight simulator type vs multiple types. These are the sorts of things that cause WJ to be able to operate with about 75 employees per aircraft, vs 120 at AC.

Trying to add new aircraft types to pick off small segments of the market, and giving up all these advantages and driving up costs in doing so makes no sense at all.

WJ focusses on a niche that maximizes profitability.

ACE really has no niche. They are high cost, hub and spoke, point to point, regional, national, international, premium service, low fare airline with a fleet featuring capacities from 37 to 300 seats. When ACE redefines its focus, and sticks to it, it will likely do quite well. It had a chance when it was banco, but chose to recapitalize and continue to attempt a war of attrition with everyone, financed by selling off assets.

It's no different than GM selling off a part of GM finance corp to underwrite operating losses. If you watched 60 Minutes last night, you will remember the CEO of GM said that, in essence, if GM doesn't make money selling cars, it's core business, GM's feature is very bleak. AC's perpetual problem is it doesn't make money flying airplanes, it's core business. Same problem, same result.

Cost, cost cost. Nothing is more important in a commodity business.

;)

....and it is not a cheap shot!

Why is it that the 600 series is called by some a flying pig? Or is it just the Airbus-Boeing bunfights?

Wasn't the 737 originally nicknamed Fat Albert or something? Maybe it's just an extension of that?

....and it is not a cheap shot!

Why is it that the 600 series is called by some a flying pig? Or is it just the Airbus-Boeing bunfights?

A smaller derivative of an existing aircraft is always going to be less efficient. The same problem afflicts the A318. Interesting if you go to the Boeing site (for those of us not as connected as others) the 600 doesn't even have its own info page.

A smaller derivative of an existing aircraft is always going to be less efficient. The same problem afflicts the A318. Interesting if you go to the Boeing site (for those of us not as connected as others) the 600 doesn't even have its own info page.

If Boeing didn't want to make the -600, they could scrap it. It's a niche airplane for a niche market. Guess what. Canada, with 31 million population and vast distances, is a niche market. There's no other market like it. Not even Oz where most of the traffic is focussed on 5 cities. After that, there's virtually nothing.

The -600 works very well in this environment. If slots were the be all, end all, the 600 wouldn't make a lot of sense in Canada. If there were dozens and dozens of o & d markets in Canada separated by 750 miles or less, with a dozen + daily 120+ seaters each direction, EMB180's would make more sense. That's not how it is though. You need an airplane that can comfortably, and reliably fly 250 miles to 3,000 mile sectors. Boeing builds it, EMB doesn't.

The Emb180 cruises low. For example, todays YYC-JFK is cruising at 31,000 feet. It's an hour late too. Oops. Another 180?

At the same time, WJA682 YVR-YYZ is a -600 with winglets, cruising at a far more efficient 37,000 feet. Both are on the same basic track, through North Dakota, Minnesota, Wisconsin to pts east. Both are at about the same ground speed.

It remains to be seen if AC customers will be thrilled to be in a cigar tube on a 2,000 mile stage length when larger iron is available. Then there's AC's patented hub and spoke by-pass strategy.

We're hub and spoke.....no, we're point to point.......no, we're hub and spoke.... no, we're hub and spoke.... You'd think they'd have made up their minds when they were in banco...but that was when they said they were going to reduce domestic capacity and focus on international.....but now it's kind of the opposite...again.

;)

...The -600 works very well in this environment. If slots were the be all, end all, the 600 wouldn't make a lot of sense in Canada. If there were dozens and dozens of o & d markets in Canada separated by 750 miles or less, with a dozen + daily 120+ seaters each direction, EMB180's would make more sense. That's not how it is though. You need an airplane that can comfortably, and reliably fly 250 miles to 3,000 mile sectors. Boeing builds it, EMB doesn't.

The aircraft is going to be very good at 250 mile stages or 3,000 mile stages. It is not going to be the optimal aircraft at both.

...It remains to be seen if AC customers will be thrilled to be in a cigar tube on a 2,000 mile stage length when larger iron is available. Then there's AC's patented hub and spoke by-pass strategy....

I haven't read many pax complaints about the 190, teething troubles withstanding. An interesting layman's article here:
http://www.usatoday.com/travel/flights/2006-03-07-embraer-usat_x.htm

We're hub and spoke.....no, we're point to point.......no, we're hub and spoke.... no, we're hub and spoke.... You'd think they'd have made up their minds when they were in banco...but that was when they said they were going to reduce domestic capacity and focus on international.....but now it's kind of the opposite...again.



Haven't you conveniently ignored the fact that by downguaging aircraft they have reduced capacity. It has always been the stated strategy to fly smaller planes more frequently. Since you haven't run a real airline with int'l flights, multiple bases etc. how can you make an informed comment as to what is needed in terms of domestic feed for int'l flights etc etc. Surely you're not suggesting AC turn over domestic flying to a competitor who has referred to them as an evil empire and resorted to corporate espionage? ;)

I guess you have to ask who calls it a "flying pig". Cur? Simon? Parnel? YOWKid? This is the gang that assess airline profitability by counting cars in airport parking lots.

You still can't get it right. I'm not part of the gang that assesses airline profitability by counting cars in airport parking lots. I never have. :rolleyes:

We're hub and spoke.....no, we're point to point.......no, we're hub and spoke.... no, we're hub and spoke.... You'd think they'd have made up their minds when they were in banco...but that was when they said they were going to reduce domestic capacity and focus on international.....but now it's kind of the opposite...again.

And what is WS?

I guess you have to ask who calls it a "flying pig". Cur? Simon? Parnel? YOWKid? This is the gang that assess airline profitability by counting cars in airport parking lots.

;)
I never said WS is not a viable business, in spite of my disappointment of them moving away from the original LCC model. I detest westjet because of their lack of perks for frequent flyers, deglamorizing air travel without really offering significant savings for consumers, the "action" i have to deal with whenever around a WS employee, and their (lack of) scheduling on CA-US routes.

Spare me from engaging in the pissing matches you seem to thrive on (more than Clive when he smells Milton's blood), because after all, I do fall into this bracket that "assesses airline profitability by counting cars in airport parking lots."

:rolleyes:

And 2 points:
-have you've ever FLOWN in a 190, let alone ACTUALLY SEEN ONE? They're 90% as big as 736's
-air canada can't make up it's mind whether or not it's point-to-point or hub-spoke? is WS one to talk about routing? didn't you say that canada is unique because it's one of the least dense nation states in the world? is there an airline that's actually, purely, hub+spoke? like, if i were to go to tokyo from the US, i'd fly out of one station and only one station?

I'm really not interested in getting involved in the CASM war, but I would like to contest this statement:

I detest westjet because of their lack of perks for frequent flyers, deglamorizing air travel without really offering significant savings for consumers , ...

In 2001, when only AC flew YOW-YYC, the cheapest high-season fares were $700 return. Now that WS serves the route, the cheapest high-season fares typically run less than $500. I know AC and WS match each other on practically every route (with slight differences depending on which airline has more seats to unload at any given time) so it appears that WS does not offer any sort of savings, but fares have gone down considerably whenever WS has entered a market. And I have no doubt they will go back up if either airline decides to exit a market.

And if a flight is almost sold out, WS's highest fares are less than 50% of AC's highest fares. That makes a big difference if you have to get somewhere at the last minute.

Competition is good. We need more than 1 airline.

Oy. Where to begin?

The 737-600 is not a "pig", as some here would have you believe. It's cost to operate, on the same stage length, is in proportion to it's size relative to the -700.

If WS should decide, for example, to operate the airplane to HNL in the slower summer season, then the CASM would be about the same as the -800. It will be cheaper to operate on short hauls than an -800. Except for the wheels and tires, everything fits all 3 models. Need an FMC for a -600? It's the same as the one from a -700. Seats? Same. Aileron? Same. Flush motor for the lav? Same.

I think for WS, the -600 will be a route builder. If a new route takes off, pull the -600 and put in the-700. No worries about crew, ground support equipment; just put it in and carry on.

A word about the Embraer. Not a bad airplane, but it has it's shortcomings. When they brought it YYC, I had a ride in it and it was okay, but not the 2200 mile vehicle I thought it would be. If you want big range, you have to fly it slow. If you want to fly the same speed as a 737, count on burning as much fuel as -700. When I went into the cockpit of the EMB170, I noted a fuel flow of 4400 pounds per hour to cruise at .76 mach. That's the same as we burn in the much larger -700 to do .78 mach. Seems to me that if you want to save a lot of fuel inb the EMB, you have to fly it slower. A lot slower.

Anyway, those are my thoughts. Not as newsy as lightening one-liners about Kool-aid drinking and the Kingdom of Klive, but then I care about the airline I work for making money, not taking the the cheapest shot.

I'm really not interested in getting involved in the CASM war, but I would like to contest this statement:



In 2001, when only AC flew YOW-YYC, the cheapest high-season fares were $700 return. Now that WS serves the route, the cheapest high-season fares typically run less than $500. I know AC and WS match each other on practically every route (with slight differences depending on which airline has more seats to unload at any given time) so it appears that WS does not offer any sort of savings, but fares have gone down considerably whenever WS has entered a market. And I have no doubt they will go back up if either airline decides to exit a market.

And if a flight is almost sold out, WS's highest fares are less than 50% of AC's highest fares. That makes a big difference if you have to get somewhere at the last minute.

Competition is good. We need more than 1 airline.

Agreed! This is why I think WS is a good business. Just not a business I can really be loyal to due to other (nonCASM reasons)

Clive will not relent that Canada is only a 2-airline country. Not so much because he believes there can only be two, but only becuase it's the only way he can get away with charging $450 YYC-YYZ and calling that a sale. Although putting pressure on a monopoly will always be good in my books, airfare in Canada is way too high.

Furthermore, I don't know why everyone is badmouthing the 600. There isn't really argument against it, even from me. WN operates 2 different aircraft type, and Frontier goes off four but with two different manufacturers

..Anyway, those are my thoughts. Not as newsy as lightening one-liners about Kool-aid drinking and the Kingdom of Klive, but then I care about the airline I work for making money, not taking the the cheapest shot.

Well then, I guess you could offer to work for free :p

Some Westjet-Uber-Alles folk deserve the cheap shots. While taking potshots at AC's decision to go with different aircraft types to match the size of the market, they (deliberately) ignore the conundrum that puts WS in: they admit Canada is a nation of thin markets, so how do you efficiently serve all of those with a relatively large narrow body jet. The 600 is still a big aircraft. By default they are arguing that AC should pull out of a lot of domestic flying and leave that to who...hmmm lets see...how 'bout Westjet?! Or do they think AC should pull out of larger Canadian domestic markets, but still keep flying Dash-8's to those that WS does not want to serve? As if that would work.

As to the economics of the 190 vs 600, I defer to your opinion, though I do then find it odd that AC would choose it over the 318, which must offer similar costs to a 736?

In 2001, when only AC flew YOW-YYC, the cheapest high-season fares were $700 return. Now that WS serves the route, the cheapest high-season fares typically run less than $500.

Not anymore. YOW-YYC this summer is currently going for $700. Not what I would call low cost...

Competition is good. We need more than 1 airline.

Competition is good. I don't disagree. That's why I think WS is great. Except the problem with WS now is that it is no longer a LCC.

But what I personally don't like is the race to the bottom that we are seeing in the airline industry almost everywhere.

Well then, I guess you could offer to work for free :p

Some Westjet-Uber-Alles folk deserve the cheap shots. While taking potshots at AC's decision to go with different aircraft types to match the size of the market, they (deliberately) ignore the conundrum that puts WS in: they admit Canada is a nation of thin markets, so how do you efficiently serve those with a relatively large narrow body jet. The 600 is still a big aircraft. By default they are arguing that AC should pull out of a lot of domestic flying and leave that to who...hmmm lets see...how 'bout Westjet?!

As to the economics of the 190 vs 600, I defer to your opinion, though I do then find it odd that AC would choose it over the 318, which must offer similar costs to a 736?

Work for free? Nah, I've been well paid for my time at WS, and why change what has worked so far.

Traditionally in Canada, the 737-200 and DC-9 were the small airplanes, the workhorses. Everywhere from YSB to YRB, they carried the load, profitabley and without fanfare. But it all changed. I can only offer my opinion why that happened.

The carriers of the day lost control over cost. Where in 1978 CPAir could fly a 737-200 on an Edmonton-Grande Prairie-Fort St. John-Ft. Nelson-Watson Lake routing, by the early 80s it was not economical due to a high cost structure. What to do? Up the fares? Then less people fly. Now what? Pass it to your regional partner flying an F28. That airplane has high unit costs, so you have to charge more. Less people fly. Better downgauge to a Dash8. Still high unit costs, less people fly, fly the Beech 1900, higher costs per ASM. Next thing you know, service is dropped to some of these communities.

It boils down to what the market will bear. In the mid 1990s, a return ticket from Grande Prairie to Edmonton cost more tha $800. People got back in their cars and pick-ups in droves. Along comes the LCC and says "I'll take you to the city and back for $300 return". The local people give up the 6 hour drive for an hour in the 737. Unfortunately for the legacy carrier, the cost remains, and turbo-prop aversion takes it's toll.

For a while, in the USA, the regional jet proved to be the answer. High fares, but since no other carrier flies from the small city to the hub, they worked. As soon as a LCC moves in, the economics of the RJ fall apart.

IMO, the EMB is another RJ, with RJ economics. As long as you can find enough travellers willing to pay a premium to fly Regina to Montreal without the stop in YYZ, they work. When the LCC rolls into town with a 737-600 and can fly the same route profitabley, there is a problem. Fare wars aren't the answer when the competition has CASM 30-40% less, and a trip cost that is nearly, or exactly, the same.

If the market is thick enough to support the EMB at AC, it's thick enough to support a 737-600 IMO.

That is the problem AC faces.

OMG! They're SLIGHTLY modified! Well, then screw the winglets, they'd be a waste of money!!! :rolleyes:


And here I thought these things were put there just to advertise westjet.com. You mean they actually have another purpose? ;)

Ron.

AC should pull out of a lot of domestic flying and leave that to ... Westjet. AC should pull out of larger Canadian domestic markets, but still keep flying Dash-8's to those that WS does not want to serve.

I've heard this argument from WS employees on two (2) seperate occasions.

Funny to think what would happen if WS began to dominate a segment...Air Canada was Air Monopoly, how can you work "monopoly" and "$1500 YYZ-YQT" into "westjet"?

Funny to think what would happen if WS began to dominate a segment...Air Canada was Air Monopoly, how can you work "monopoly" and "$1500 YYZ-YQT" into "westjet"?

Charging extremely high fares goes against Westjet's model of stimulating traffic. I know you and others won't agree with me but that's a fact and raping customers would do more harm than (financial) good. Oil is ~$65 bbl, don't sit there and complain that ticket prices are too expensive.

I've heard this argument from WS employees on two (2) seperate occasions.

Funny to think what would happen if WS began to dominate a segment...Air Canada was Air Monopoly, how can you work "monopoly" and "$1500 YYZ-YQT" into "westjet"?


WJA had the monopoly on YXX for years and the fares were common rated with YVR.

YQQ-YYC is a n/s monopoly for WJ. There's about a $10 premium. You wanna fly into YYJ and drive north for 3 hours or pay $10?

There's only airline that's abused it's monopoly position.

All the Toronto-Windsor flights are $239 one way tomorrow, $1.23 a mile, where there's no competition, but Calgary-Edmonton is as little as $95 tomorrow, or 62 cents a mile.

How about the Toronto-Sudbury monopoly tomorrow at $310 one way, or $1.46 a mile vs. the Kelowna-Vancouver situation at $95 one way, or 53 cents a mile.

Do you really think that's a good way to build goodwill and loyalty? Support us, and we'll rape you when competition is gone?

Very short sighted, but leaves lots and lots of opportunities for other carriers.

All in good time.

:D

Not anymore. YOW-YYC this summer is currently going for $700. Not what I would call low cost...
There will be a seat sale at some point.

But what I personally don't like is the race to the bottom that we are seeing in the airline industry almost everywhere.
I agree with you there.

I was doing a bit of digging to find some real, actual, supportable, verified and researched comparisons of the EMB 190/5 vs 737-600 economics but didn't get much where I didn't have to pay for a $ subscription to access the article text. The only readily available data is that the EMB 190/5 is clearly outselling the 737-600 but that in itself doesn't specifically prove anything.

However, there were some graphs that plotted payload vs range and while the 737-6/7/800 were clustered rather tightly together with a to be expected slope, the EMB 190/5 was clearly a different animal. So, you have to figure that the route flexibility between the two are less interchangeable than within the 737 family itself. There appears to be a general consensus that in isolation the 737-600 and A318 are both uncompetitive aircraft, however the economic picture for any particular operator has to be ascertained by "weighing capital outlay vs fleet complexity, fuel and other market forces". Given that the operating costs for the 737-600 are only marginally greater than the 737-700 it may be a good choice for the 100 seat market especially when compared to the 737-200.

The real issue may be how does Westjet tackle the 50 - 75 seat market if at all.

I was doing a bit of digging to find some real, actual, supportable, verified and researched comparisons of the EMB 190/5 vs 737-600 economics but didn't get much where I didn't have to pay for a $ subscription to access the article text. The only readily available data is that the EMB 190/5 is clearly outselling the 737-600 but that in itself doesn't specifically prove anything.

However, there were some graphs that plotted payload vs range and while the 737-6/7/800 were clustered rather tightly together with a to be expected slope, the EMB 190/5 was clearly a different animal. So, you have to figure that the route flexibility between the two are less interchangeable than within the 737 family itself. There appears to be a general consensus that in isolation the 737-600 and A318 are both uncompetitive aircraft, however the economic picture for any particular operator has to be ascertained by "weighing capital outlay vs fleet complexity, fuel and other market forces". Given that the operating costs for the 737-600 are only marginally greater than the 737-700 it may be a good choice for the 100 seat market especially when compared to the 737-200.

The real issue may be how does Westjet tackle the 50 - 75 seat market if at all.

My guess is they'll tackle the 50-75 seat market the same way Air Tran / Gol / Virgin Blue / Southwest / Ryanair and other LCC's tackle the 50-75 seat market.

You can't offer low, stimulative fares with high costs. It has never worked before, it's not going to work anytime soon.

Independence Air proved it yet again, none the less, AC is paying Jazz to keep doing it head to head with WJ. I'm not quite sure when the penny will drop at ACE. Probably when the assets are sold off and there are no operating profits to speak of.

Keep in mind a WJ E190 would have 100 seats, the same config as JBLU. ACE's have 84 in coach, 93 in total, which is pretty much what the DC9-30's had.

The -600's have 19 seats more, or 119 total. It's not a particularly significant difference, going from 100, (or even slightly more than 100), to 119. Given what the aircraft can do, compared to a 190, the considerably better unit costs, the simplicity of a uniform fleet, the decision to go with -600's was pretty much a no brainer.

;)

...Independence Air proved it yet again, none the less, AC is paying Jazz to keep doing it head to head with WJ. I'm not quite sure when the penny will drop at ACE. Probably when the assets are sold off and there are no operating profits to speak of... ;)

And once again you go on to prove only that you've got experience running an LCC that steals grannys off the greyound bus, but none running a large international carrier. Indy was a disaster precisely because it was not a feeder for a large carrier, as Jazz is for AC.

Keep in mind a WJ E190 would have 100 seats, the same config as JBLU. ACE's have 84 in coach, 93 in total, which is pretty much what the DC9-30's had.

The -600's have 19 seats more, or 119 total. It's not a particularly significant difference, going from 100, (or even slightly more than 100), to 119.
;)

Which leads me to wonder why Jetblue went with the 190 instead of an A318?

And once again you go on to prove only that you've got experience running an LCC that steals grannys off the greyound bus, but none running a large international carrier. Indy was a disaster precisely because it was not a feeder for a large carrier, as Jazz is for AC.


......and you think regional carriers are profitable, eh? Regionals are only as profitable as the mother ship is prepared to let them be.

Indy was a disaster because they tried to offer SWA type fares with a cost structure 2x as high as SWA. If they had someone to underwrite the losses, as ACE does for Jazz by guaranteeing revenues and underwiting fuel costs, regardless of performance, they could have "survived".

It's all in how you allocate revenue on a route.

YLW-HKG is 6,571 miles. The YLW-YVR portion makes up 2.7% of the miles of the trip.

Do you proportionately allocate $26.56 to YLW-YVR and then $948.44 to YVR-HKG on a $975 fare?

Or do you knock the YLW-YVR portion of the flight off, which is currently priced at $115, and leave $860 allocated to YVR-HKG?

Or do you do something in the middle?

You can make good arguments either way. One will maximize profitability on YLW-YVR, the other will maximize profitability on YVR-HKG.

It depends what is in the best interest for the controlling stakeholder, ACE, as to what part of the business it wants to put lipstick on. Either way, the total revenue is the same.

In this case, ACE wants to put lipstick on Jazz to suck as much cash out of it as possible, no different than when Continental did the same with Expressjet a few years ago. That stock languished at the IPO price and then dropped, just like Jazz.

Not only do they maximize revenue by biasing it away from mainline and more to Jazz, but they under allocate the costs to Jazz and over allocate to ACE.

The total expense hasn't changed, just the way it is allocated between the two companies.

And to think there are people who still think Regional's are profitable using any normal, common sense accounting methodology.

;)

Which leads me to wonder why Jetblue went with the 190 instead of an A318?

Do 1,200 mile range circles from JFK and count the number of domestic markets with populations larger than 300,000. Do it again out of Long Beach.

Do the same exercise out of YYZ.

Get it, yet?

Completely different markets. There simply aren't the utilization opportunities in Canada for an airplane with that sort of target optimum range. You have to be able to use them on much longer routes / charters / long haul transcon, to make 'em work in Canada.

I don't think ACE will have much success competing against their own iron, let alone WJ's trying to operate the 190's on YYC-YYZ, or YVR-YYZ, etc. They'll be perceived as tiny, noisy and slow aircraft on those longer routes and customers will tend to gravitate towards the bigger iron.

If they are the only choice, people will use them, but how many hub by - pass markets will AC have in Canada, and for how long? How long will it be before WJ puts -700's out of Saskatchewan to YYZ, vs the much smaller EMB's?

E180's are far to expensive to profitably operate on charter routes where low cost means more than anything for tour operators.

Sure, the -600 doesn't work for everyone, but in Canada, they make perfect sense, vs Emb aircraft.

;)

......and you think regional carriers are profitable, eh? Regionals are only as profitable as the mother ship is prepared to let them be... ;)

Where did I say that? What you can't seem to fathom is that what matters is that ACE is profitable. What I challenged was your continual attempts to compare Jazz to Independence. That's as valid as comparing WS to Helios, since they both operate 737's.

Where did I say that? What you can't seem to fathom is that what matters is that ACE is profitable. What I challenged was your continual attempts to compare Jazz to Independence. That's as valid as comparing WS to Helios, since they both operate 737's.


.....and what matters is ACE is profitable because it is selling off assets. The collective ventures that generate operating revenue do not generate enough to offset operating costs and interest expense to cover off the cost of capital.

If ACE breaks-even in 1Q on an operating basis, and Sebring is correct about 2q and 3q, and 4Q is break-even again, that's a $450m operating profit per year, (including interest as an expense at about $75m a quarter) with over $10b in revenue, or a margin of about 4.5%. That does not cover the cost of money these days.

ACE needs to get those margins into the very high single digits on an annuallized basis if it is going to survive in the long term. If any of you operate a capital intensive business, you know that 4.5% margins are not going to cut it.

;)

.....and what matters is ACE is profitable because it is selling off assets. ....
.. and Westjet sells airplanes to get cash.

.. and Westjet sells airplanes to get cash.

Uh, yes. The multi million dollar financings the public company is doing, without divulging it anywhere.

Sure...

My suggestion to you is to a)learn how to read financial statements and b) learn the mechanics of ExIm financing.

That might be a littlt tuff for an outsider.

;)

I think he might have been referring to the -200's. Because I guess WS was suppose to just park those in the desert or give them to every aviation tech school that came knocking, instead of actually taking somebody up on the offer to take them off WS's hands LOL.

I think he might have been referring to the -200's. Because I guess WS was suppose to just park those in the desert or give them to every aviation tech school that came knocking, instead of actually taking somebody up on the offer to take them off WS's hands LOL.
Not at all.

Westjet had to take some of their -700's and sell/lease back in 2005 to the tune of $400 million dollars.

OK, thanks for the clarification.

I think he might have been referring to the -200's.

I might be off by an aircraft or two... but we sold 10 737-200's to company (parts & sim included) at the end of 2005. We retired eight 737-200's and have them parked in the desert (I read somewhere that there is still one parked in YEG but I can't confirm that). We have donated 2or 3 737-200's to various companies (such as BCIT in YVR) across Western Canada and sold one to a flight school in England.

Westjet had to take some of their -700's and sell/lease back in 2005 to the tune of $400 million dollars.

I don't know how accurate that dollar figure is but the sell/lease of those aircraft were to keep our fleet in-line with the 1/3-leased, 2/3-owned policy we've tried to follow over the years. I could be wrong and this is all one giant, monsterous conspiracy.

I don't know how accurate that dollar figure is but the sell/lease of those aircraft were to keep our fleet in-line with the 1/3-leased, 2/3-owned policy we've tried to follow over the years. I could be wrong and this is all one giant, monsterous conspiracy.

The Westjet 2005 annual report is very clear on the sell/lease-back arrangements and how this resulted in a net gain for a one group of aircraft, the cash which then could be used to support attractive financing rates on more aircraft. How an intelligent mix of purchase finance and leased aircraft with a net-gain to the bottom-line could be seen negatively is rather curious. It is hardly a "have to" situation. It is part of a strategy and pattern of financing aircraft acquisitions not operating cash-flow.

The is certainly in contrast to AC's pre-re-org tactics of sell/lease-back to generate operating cash or their current sell-off of segments of the company as separate entities. Not that there was or is anything necessarily bad about these approaches either given the associated circumstances. I don't know enough about what ACE is doing with the spin-off cash to give an opinion on whether the spin-offs are good or not.

Not at all.

Westjet had to take some of their -700's and sell/lease back in 2005 to the tune of $400 million dollars.

My suggestion to you, again, is to a)learn how to read financial statements and b) learn the mechanics of ExIm financing.

A $400m transaction could not be completed without reporting it to the markets in a press release.

;)

My suggestion to you, again, is to a)learn how to read financial statements and b) learn the mechanics of ExIm financing.

A $400m transaction could not be completed without reporting it to the markets in a press release.

;)
It was reported, maybe you missed it. It was couched as getting an attractive lease deal.

It was not Exim related except that they had tapped out the Exim line because of their cash position.

By the way. The 1/3 owned etc is incorrect. The new mantra is 1/3 owned, 1/3 leased, 1/3 financed.

I don't know how accurate that dollar figure ....
I admit it wasn't $400 million.

It is given in the annual report as 404,583,000.

By the way. The 1/3 owned etc is incorrect. The new mantra is 1/3 owned, 1/3 leased, 1/3 financed.

That's been the policy for years. It's never changed. It's the same way SWA acquires airplanes. What's good for the goose is good for the gander.
;)

WJA tapped out of cash? :D No more Exim financing? :D

Massive sale lease backs? ;)

You are a barrel of laughs this morning!

So the $400M was reported to the markets, and is in the financial statements.

But still did not happen.

I wonder if AC had done the same, what we would be hearing?

"AC made 0.00021 cents per day between Nov 10 and 12, and this was aided by selling aircraft! What assets will they have left? Now I have to go back to the beach I own" sounds likely.

So the $400M was reported to the markets, and is in the financial statements.

But still did not happen.

I wonder if AC had done the same, what we would be hearing?

"AC made 0.00021 cents per day between Nov 10 and 12, and this was aided by selling aircraft! What assets will they have left? Now I have to go back to the beach I own" sounds likely.

A stand alone transaction such as that, far and away the largest one in WJ's history, would be reported when it occured, with a separate press release,

It is unlikely the transaction happened to occur the day the financial statements were released. $400m deals don't work that way.

By the way, AC's loss per second including interest expense, was $15.69 in the 4th quarter. ;)

..By the way, AC's loss per second including interest expense, was $15.69 in the 4th quarter. ;)

How scintillating. Sad for you that a fiscal year has 4 quarters though :(

I wonder when WS will make a quarter of a billion dollars?

How scintillating. Sad for you that a fiscal year has 4 quarters though :(

I wonder when WS will make a quarter of a billion dollars?

With last year's operating margin, WJ will make $250,000,000 profit when annual sales are about $8.0b. Last years revenues were $1.4b. By US definition, that makes WJ a "major" airline. That must be tuff to take.

It'll be a lot sooner if WJ follows AC's path and chooses to sell off a chunk of their assets every quarter to pump up the "profit".

Margin is the key, not raw profit. How else can you compare larger companies to smaller companies? I'm sure General Foods makes more money than smaller producers, but I'll bet smaller producers have higher margins.

AC had $9.83b in revenue last year, with 84% of the revenue coming from passenger transportation. That's 2.6% net after tax margin. Nothing much to get excited about.

How much has AC really diversified into other business units?

In 1991 80.7% of revenues came from passenger transportation.

In 1994, it was 78.8%

In 1996, it was 81.5%.

In 1998, it was 83.9%.

In 2000, it was 85.6%

In 2002, it was 83.4%

In 2003, it was 82%

In 2005, 84% of revenues came from passenger transportation.

The fact is, AC is less diversified today than it was when it merged with CP.

The spin about all the funky revenue streams is great, but more of AC's revenue come from it's core business than just about ever before, and that core business produced an operating margin, including interest expense, of just 1.39% last year.

That's why the sell off continues. 1.39% is no where near enough in a capital intensive business. The cost of capital is over 5%.

What happens when the garage sale is over and all the good assets have been liquidated?

That's what you have to think about, and what sort of changes AC will have to make, with an axe instead of a scalpel, in order to survive.

;)

2005 figures:

BA is the 3rd most profitable airline in the world (LH was second, FedEx was first).

The story behind the story however:

BA ranked 13 on the list for actual operating margin (with a 6.9% yield). Conversely, Ryanair topped the list, with a staggering 24.5% yield.

You can slice it up to look appealing, but the fact remains that it's your operating margin that counts. CASM plays a key role in that, but if you're not getting the yield, then where are you?

WestJet is fortunate in being able to 'cherry pick' the prize routes in Canada, and operate them with it's 40-45% lower CASM. But, as has been proven, when it comes to the more marginal stations, WestJet struggles and will pull out pretty quick. Low costs alone don't cut it. And wheras you might get 20 people willing to pay top $$ for a flight to/from Thompson, MB and thereby justify a Saab 340 operation, you couldn't justify a 737 operation.

WestJet cannot offer a comprehensive service to the regional points, but that's not to say that AC can't make them work either. Looking to the future, there is talk of major expansion with Georgian, who with their lower costs but AC flying agreements, will extend the AC service blanket into a host of new routes, but at an affordable CASM that make economic sense.

It's easy to sit in the WestJet dug-out and shout 'rah rah, we're going like gangbusters', but fact is, if you took a blank sheet of paper and started fresh without seniority, unions and complicated and archaic agreements, it suddenly becomes a lot easier when you focus purely on cherry picking the 'good' routes.

Welcome aboard...good first post.

You will note here that the wetjet fanatics cannot be denied from singing the same old refrain at every turn.....The result of good brainwashing by management.

2005 figures:

BA is the 3rd most profitable airline in the world (LH was second, FedEx was first).

The story behind the story however:

BA ranked 13 on the list for actual operating margin (with a 6.9% yield). Conversely, Ryanair topped the list, with a staggering 24.5% yield.

You can slice it up to look appealing, but the fact remains that it's your operating margin that counts. CASM plays a key role in that, but if you're not getting the yield, then where are you?

WestJet is fortunate in being able to 'cherry pick' the prize routes in Canada, and operate them with it's 40-45% lower CASM. But, as has been proven, when it comes to the more marginal stations, WestJet struggles and will pull out pretty quick. Low costs alone don't cut it. And wheras you might get 20 people willing to pay top $$ for a flight to/from Thompson, MB and thereby justify a Saab 340 operation, you couldn't justify a 737 operation.

WestJet cannot offer a comprehensive service to the regional points, but that's not to say that AC can't make them work either. Looking to the future, there is talk of major expansion with Georgian, who with their lower costs but AC flying agreements, will extend the AC service blanket into a host of new routes, but at an affordable CASM that make economic sense.

It's easy to sit in the WestJet dug-out and shout 'rah rah, we're going like gangbusters', but fact is, if you took a blank sheet of paper and started fresh without seniority, unions and complicated and archaic agreements, it suddenly becomes a lot easier when you focus purely on cherry picking the 'good' routes.

Marginal routes like YEG-YLW? YYC-YQQ? YEG-YQR? YLW-YYJ? YEG-YQU? YXX-YYC?

What you don't get is that for the first 4 years, over 50% of WJ's routes were routes no one else flew non-stop. Is that cherry picking? Or smart business?

Or is cherry picking the audacity to actually fly into the number one market in Canada?

Air Georgian B1900D's low cost? Gimme a break. Try 30 cents + casm. Next you'll tell me some rocket scientist has developed a plan to beat LUV with a fleet of 19 seaters......

Sault and Sudbury were to YHM. Hmmmm. I wonder what would happen to those $1 a mile yields if WJ decided to operate them from YYZ? With 119 seaters? Once a day. That'd put the cat amongst the pigeons.

And just how much of the 3rd quarter 2005 profit will AC be handing back in the 4th and 1st quarters? Pretty close to the whole enchilada.

And how about that new strategy of revenue diversification from all the various sources. The only problem with that is that more ACE revenue comes from passenger traffic today than it did 10 years ago. It's gone up every year, save one.

Spin, spin spin. ACE lives or dies on the success of the airline. You, know, the one that made 1.39% operating margin including interest expense last year.

;)

With last year's operating margin, WJ will make $250,000,000 profit when annual sales are about $8.0b. Last years revenues were $1.4b. By US definition, that makes WJ a "major" airline. That must be tuff to take.

It'll be a lot sooner if WJ follows AC's path and chooses to sell off a chunk of their assets every quarter to pump up the "profit".

Margin is the key, not raw profit. How else can you compare larger companies to smaller companies? I'm sure General Foods makes more money than smaller producers, but I'll bet smaller producers have higher margins.

AC had $9.83b in revenue last year, with 84% of the revenue coming from passenger transportation. That's 2.6% net after tax margin. Nothing much to get excited about



How much has AC really diversified into other business units?

In 1991 80.7% of revenues came from passenger transportation.

In 1994, it was 78.8%

In 1996, it was 81.5%.

In 1998, it was 83.9%.

In 2000, it was 85.6%

In 2002, it was 83.4%

In 2003, it was 82%

In 2005, 84% of revenues came from passenger transportation.

The fact is, AC is less diversified today than it was when it merged with CP.

The spin about all the funky revenue streams is great, but more of AC's revenue come from it's core business than just about ever before, and that core business produced an operating margin, including interest expense, of just 1.39% last year.

That's why the sell off continues. 1.39% is no where near enough in a capital intensive business. The cost of capital is over 5%.

What happens when the garage sale is over and all the good assets have been liquidated?

That's what you have to think about, and what sort of changes AC will have to make, with an axe instead of a scalpel, in order to survive.

;)

Why is it that you can never post without knocking AC? Perhaps other posters would find you more creditable if you stuck to thread topics and posted useful, relevant information to FF's which is what this site is supposed to be about. It seems that the common thing about posters associated with WJ is that they cannot resist patting themselves on the back. Oh,in case you didn't notice this thread is about the delivery of another 737-600. Yes I know this post is also off topic but PLEASE spare us the the AC bashing and just stick to providing useful information.

Why is it that you can never post without knocking AC?

It's the only reason he's here. He's made a career out of it since his previous job ended so abruptly.

You will note here that the wetjet fanatics cannot be denied from singing the same old refrain at every turn.....The result of good brainwashing by management.

You will also notice that the Air Canada apologists act like their poop don't stink..

Perhaps. But we don't just hit "rewind", "play" and then post the same old thing over and over and over and over again on every post.

For the most part we are here to assist and learn from other FFers.

What does this poster ever do to assist and learn from other FFers?

The only piece of information that he apparently has which would help is the publicly available website that lists exact flight loads for every AC flight. And he won't even share that.

Perhaps because while there is a legal case ongoing, he has been advised not to.

Then again, he (or was that Girard737) is just an average working stiff with no connection to WS.

The topic of this thread is the recent delivery of a 737-600 to WestJet. The topic is not about WestJet apologists or Air Canada apologists or even comparisons as to which company has the better shills. Please refrain from comments about other members.

FewMiles..
Moderator, WestJet forum

[QUOTE]Why is it that you can never post without knocking AC?


I think he's pumping the shares of Boeing and their 600 series planes plus the fact AC won't hire him since he may have been part of the AC theft attack.

Perhaps other posters would find you more creditable if you stuck to thread topics and posted useful, relevant information to FF's which is what this site is supposed to be about. It seems that the common thing about posters associated with WJ is that they cannot resist patting themselves on the back.


Having an all Boeing 600/700 fleet makes one's ego work more. One trick ponys simply like to brag.

Oh,in case you didn't notice this thread is about the delivery of another 737-600. Yes I know this post is also off topic but PLEASE spare us the the AC bashing and just stick to providing useful information.

True enough

Different choir, same song.

Too bad nobody can find or post some really good analysis on 737-600 vs EMB 190/5 economics that cover the complete acquisition, operational, maintenance, and in-direct fleet diversity/commonality/training costs/route flexibility.

What you don't get is that for the first 4 years, over 50% of WJ's routes were routes no one else flew non-stop. Is that cherry picking? Or smart business?


Coffee - I'm amazed you know so much about me (and what I do or don't 'get') - all from from one posting. In actual fact, I do 'get it'. I worked for WestJet during those early years, and I watched as they pulled out of Thompson, Brandon, Sault Ste Marie, Sudbury... oh, and don't forget YHM, the WestJet 'Hub of the East' - how many flights a day there now? Oh, that's right, the yield on those cherry routes into YYZ is much better - thanks Hamilton - SEE YA!


Air Georgian B1900D's low cost? Gimme a break. Try 30 cents + casm. Next you'll tell me some rocket scientist has developed a plan to beat LUV with a fleet of 19 seaters......


It's called Horses for Courses. The 737-600 is not suited to many smaller or niche markets. Of course the Beech, Dash 8, Saab 340 etc. will have higher CASM. But PLEASE! It's not just about CASM! Westjet might be able to operate with a lower CASM into Terrace, BC or Thompson, MB.... but with what yields? And with what frequency?

Smaller regional aircraft, whilst having a higher CASM (and that's irrespective of operator), are able to provide frequency of service to smaller markets that the 737-600 could not. Again - as it appears the point was missed first time around - IT'S NOT JUST ABOUT CASM!!


Spin, spin spin. ACE lives or dies on the success of the airline. You, know, the one that made 1.39% operating margin including interest expense last year.

I don't recall any 'spin spin spin' - at least in my post. Oh, that's right, just another opportunity to trot out your anti-AC mantra. :rolleyes:

Cheers. :cool:

A little bit about CASM, and the 737-600 (and indeed, all of WestJets 737's)...

To further illustrate my previous post:

Let's take a 737-600. It has 136 seats. CASM, which certain WestJet analysts like to use as a mantra/gavel/large stick, is worked out on the basis of AVAILABLE SEATS. i.e. 136 of them.

So, great. We can see that WestJet has a lower CASM than AC, Jazz, Air Georgian, <insert airline here>.

However - let's say that we were to put the 737-600 flying from Winnipeg to Thompson. In fact, WestJet did that route before. Problem was, they only got about 30-40 pax per flight (and that was only 3 times a week I believe).

So if the market size will give 30-40 pax per flight, and you are running a 136 seater aircraft. It's about 460 miles for the stage length. Let's say that WestJet is running at a CASM of 18c. Cost of flying the aircraft up to Thompson = $11,250 give or take.

On the basis of an average load factor of, say 35, that would mean to break even, every single seat for this 450mile flight would have to be sold at $321 one way plus taxes etc.

Now, let's take our little regional Dash-8 with, say 37 seats, operated by an airline with a postively hugely uncompetitive CASM of 28c.

On basis of the 35 seats load factor, to break even, every single seat for this flight would have to be sold at $133 one way plus taxes.

So, as you can see, our 'uncompetitive' regional carrier with a 'high CASM' can actually undercut WestJet's 737-600 by some 60%.

Rocket Science isn't about beating LUV with a bunch of 19 seaters Coffee - you're quite right. It's about putting the right aircraft on the right route. Something this thread about 737-600's is somewhat relevant too! And, whilst I don't dispute that WestJet has an awesome cost advantage when going head to head with AC on YYC-YVR, YYZ, YWG etc etc, the fact remains that WestJet and their 737 single aircraft operation will mean they're NOT able to beat out Georgian, Jazz etc. in every market no matter how low the CASM.

Cheers :cool:

The WS B737-600s have 119 seats
B737-700s have 136 seats
B737-800s have 166 seats

......... in every market no matter how low the CASM.
....
Stick around and you will see that Coffeebean does not believe in 'Trip Cost', or that the AC domestic yield advantage outstrips his calculation of AC's domestic CASM.

Fisch - thanks for the clarification, my mistake.

A little bit about CASM, and the 737-600 (and indeed, all of WestJets 737's)...

Thanks for the great post. Its always good to get a knowledgable, balanced look at the facts.

Stick around and you will see that Coffeebean does not believe in 'Trip Cost', or that the AC domestic yield advantage outstrips his calculation of AC's domestic CASM.

IOW's you can filter coffee any way you want to in the percolator but it all comes out the same colour an hour or so later...........is that asm,casm, prasm or spasm related.

However - let's say that we were to put the 737-600 flying from Winnipeg to Thompson. In fact, WestJet did that route before. Problem was, they only got about 30-40 pax per flight (and that was only 3 times a week I believe).


Ah, but the difference now, as Mr. Hi... make that CB will tell you, is that nowadays, WS would fill those flights. So your point is moot :) And if you keep talking about the fact that you have to sell more than 30 seats, he'll also point out that load factor is always a meaningless statistic (even given the argument you make, where yields come in), and call you a T2 parking lot car counter. Your point is bang on, however. If load factors approach zero on a large aircraft, any cost advantage you have had goes away.

;)

Different choir, same song.

Too bad nobody can find or post some really good analysis on 737-600 vs EMB 190/5 economics that cover the complete acquisition, operational, maintenance, and in-direct fleet diversity/commonality/training costs/route flexibility.

Already done. ;)

A little bit about CASM, and the 737-600 (and indeed, all of WestJets 737's)...

To further illustrate my previous post:

Let's take a 737-600. It has 136 seats. CASM, which certain WestJet analysts like to use as a mantra/gavel/large stick, is worked out on the basis of AVAILABLE SEATS. i.e. 136 of them.

So, great. We can see that WestJet has a lower CASM than AC, Jazz, Air Georgian, <insert airline here>.

However - let's say that we were to put the 737-600 flying from Winnipeg to Thompson. In fact, WestJet did that route before. Problem was, they only got about 30-40 pax per flight (and that was only 3 times a week I believe).

So if the market size will give 30-40 pax per flight, and you are running a 136 seater aircraft. It's about 460 miles for the stage length. Let's say that WestJet is running at a CASM of 18c. Cost of flying the aircraft up to Thompson = $11,250 give or take.

On the basis of an average load factor of, say 35, that would mean to break even, every single seat for this 450mile flight would have to be sold at $321 one way plus taxes etc.

Now, let's take our little regional Dash-8 with, say 37 seats, operated by an airline with a postively hugely uncompetitive CASM of 28c.

On basis of the 35 seats load factor, to break even, every single seat for this flight would have to be sold at $133 one way plus taxes.

So, as you can see, our 'uncompetitive' regional carrier with a 'high CASM' can actually undercut WestJet's 737-600 by some 60%.

Rocket Science isn't about beating LUV with a bunch of 19 seaters Coffee - you're quite right. It's about putting the right aircraft on the right route. Something this thread about 737-600's is somewhat relevant too! And, whilst I don't dispute that WestJet has an awesome cost advantage when going head to head with AC on YYC-YVR, YYZ, YWG etc etc, the fact remains that WestJet and their 737 single aircraft operation will mean they're NOT able to beat out Georgian, Jazz etc. in every market no matter how low the CASM.

Cheers :cool:

Thanks for the lesson. :rolleyes:

The question is, do you think WJ's plan requires the capture of all traffic, no matter how small the market is?

Think it thru. If it is, the -600 is obviously too big. If it isn't, the plan is obviously to skip over the smaller, marginal markets suited to 19-50 seaters.

YHM is a large market, but not on a short haul basis. That was proven by WJ's experience there.

Brandon was Limited Addition. You'd know that if you were there. It is definitely a viable market on the same basis. Even with LA, it was extended a couple of times.

Northern Ontario was out of YHM. Would have a different result out of YYZ. All in good time.

Thompson was a gamble, the issue was the unforseen labor issues at the community's largest employer at the time. It also used an aircraft that had nothing to do for 3 hours. Not a big risk.


;)

:rolleyes: Ah, but the difference now, as Mr. Hi... make that CB will tell you, is that nowadays, WS would fill those flights. So your point is moot :) And if you keep talking about the fact that you have to sell more than 30 seats, he'll also point out that load factor is always a meaningless statistic (even given the argument you make, where yields come in), and call you a T2 parking lot car counter. Your point is bang on, however. If load factors approach zero on a large aircraft, any cost advantage you have had goes away.

;)

Thanks for the lesson. :rolleyes:

9/11 changed the short haul business completely.

If your assumption is that WJ wants to control the smallest of domestic markets, the 600 is the wrong aircraft.

Better change your assumptions.

;)

The question is, do you think WJ's plan requires the capture of all traffic, no matter how small the market is?

Think it thru. If it is, the -600 is obviously too big. If it isn't, the plan is obviously to skip over the smaller, marginal markets suited to 19-50 seaters.


:eek: :eek: :eek:

CB admits in a single post that:

(a) the 737 is not the right equipment for all markets on earth!
(b) WS' growth ultimately will end, as it will not serve all markets

Next he'll be posting the url of the secret public internet website that lists loads for all AC flights, or any other item that is of use to FF, the whole purpose of this site.

(don't hold your breath)

Simon

Thanks for the lesson. :rolleyes:


The pleasure was all mine :cool:

The question is, do you think WJ's plan requires the capture of all traffic, no matter how small the market is?

Think it thru. If it is, the -600 is obviously too big. If it isn't, the plan is obviously to skip over the smaller, marginal markets suited to 19-50 seaters.


Yes, precisely what I'm saying - CASM is not always a representative look at a carriers viability or chance at success - it depends on the route demographics/market size/passenger load/yield - a myriad of things! As was illustrated in the example above, regional carriers or AC with it's CRJ's etc. can have a higher CASM but still be viable. Where the problems arise is when the CASM is 40% higher on WestJet's on comparitave routes with comparitive aircraft (YYC-YVR etc...)


Brandon was Limited Addition. You'd know that if you were there. It is definitely a viable market on the same basis. Even with LA, it was extended a couple of times.


I never did fully understand the 'Limited Addition' concept. Maybe that makes me an ignoramus (I'm waiting for it, CB), or maybe WestJet just didn't explain the rationale behind it to the work and file at the time (me included).

Limited Addition - is this a way of saying "we're gonna try a new route, but only on a temporary basis as we really don't have the foggiest as to whether it will be a succcess or not..."

or is it "we're gonna go in just for a few months, scoop up as many travellers as possible and milk the market dry, then bolt..."

Either way, I'd question whether it builds long term local customer loyalty, and diving in and back out of markets certainly doesn't meet the needs of the local business travel sector.

Cheers ;)

:eek: :eek: :eek:

CB admits in a single post that:

(a) the 737 is not the right equipment for all markets on earth!
(b) WS' growth ultimately will end, as it will not serve all markets

Next he'll be posting the url of the secret public internet website that lists loads for all AC flights, or any other item that is of use to FF, the whole purpose of this site.

(don't hold your breath)

Simon

Chat with ACPLT. He's posted loads on the site before.

;)

Maybe it's the same place that tells me a certain US carrier flying out of the west coast tomorrow with an A330-200 to an Asian destination has 30 seats available in coach, That's a load of 86%. If you can tell me if that makes the flight profitable, please let me know how, cause without fleet type cost info and fare mix info, all you can do is make a swag.

If you can't google it for yourself, then too bad, so sad.


;)

WJA with a fleet of aircraft from 119 seats to 166 seats with economic range from from 250 to about 3,000 miles.

CASM 40-50% below AC.

I'd say that covers off enough growth for another decade or so.

When AC runs into trouble again in a few years when there're no more assets to sell and operating margins are stuck at break-even levels, then AC will have to divest themselves of the money losing flights....and the equipment that operates them.....you know, stuff like the O & D YVR-HNL flights with walk up fares for $189, like the one that leaves in less than 2 hours, or the walk up YVR-YYC fares for $90. Tuff to make that work on an ongoing basis with 17 cent casm.

That provides WJ with the next round of growth. Then frequency goes up a little more, further erasing the so called S curve. Then AC loses more money. Then they cut back more money losing routes. WJ adds another burst of growth.

It's inevitable, and predictable. It's simply a continuation of the pattern since 1996.

CCAA allowed AC to move the hands back on the doomsday clock from midnight to 5 minutes to midnight. Another couple of years selling off $400m a year in assets, (Aeroplan, Jazz, LCC stock, ACT's if it ever makes money), and op margins a few points below the cost of capital, and they'll be back to where they were in April 2003.

;)




;)

The pleasure was all mine :cool:



Yes, precisely what I'm saying - CASM is not always a representative look at a carriers viability or chance at success - it depends on the route demographics/market size/passenger load/yield - a myriad of things! As was illustrated in the example above, regional carriers or AC with it's CRJ's etc. can have a higher CASM but still be viable. Where the problems arise is when the CASM is 40% higher on WestJet's on comparitave routes with comparitive aircraft (YYC-YVR etc...)



I never did fully understand the 'Limited Addition' concept. Maybe that makes me an ignoramus (I'm waiting for it, CB), or maybe WestJet just didn't explain the rationale behind it to the work and file at the time (me included).

Limited Addition - is this a way of saying "we're gonna try a new route, but only on a temporary basis as we really don't have the foggiest as to whether it will be a succcess or not..."

or is it "we're gonna go in just for a few months, scoop up as many travellers as possible and milk the market dry, then bolt..."

Either way, I'd question whether it builds long term local customer loyalty, and diving in and back out of markets certainly doesn't meet the needs of the local business travel sector.

Cheers ;)

If you didn't get "Limited Addition", you most certainly were way, way down the totem pole, if you even were there at all.

Excess capacity. Secondary markets. Unique routes. Shoulder seasons. Finite sched suited for leisure travelers announced at time of launch.

Yes, yes, yes... Cost structure is not important........yadda yadda yadda.....music to my ears. Nothing is more important in a commodity business. How long will AC have a revenue premium? Do they even have a premium? Does the premium even cover off the cost disadvantage? With an 80% belf, I'd suggest it doesn't.

No wonder you're not at WJ. You were probably gleefully coached out.

;)

No wonder you're not at WJ. You were probably gleefully coached out.

;)

As apposed to being asked to resign when your illegal activities became public knowledge and you became an embarassment to WS.

Chat with ACPLT. He's posted loads on the site before.


And it would appear he's an internal employee, so no reason to think that he's using a publicly available Internet site.


Maybe it's the same place that tells me a certain US carrier flying out of the west coast tomorrow with an A330-200 to an Asian destination has 30 seats available in coach, That's a load of 86%. If you can tell me if that makes the flight profitable, please let me know how, cause without fleet type cost info and fare mix info, all you can do is make a swag.

If you can't google it for yourself, then too bad, so sad.


Once again:


You are the sort of person who loves the idea that you think you know something that other people don't know. Case in point is Slingbox. Even though this forum is ostensibly for frequent flyers, and SB is designed for those of us who spend time away from home, you like the idea of keeping it a little secret because it empowers you to think you are smarter than the average bear.

Replace Slingbox with "Purported super duper website".

FlyerTalk exists for users to share FF information with each other. You have the url for a site that we would all benefit from, yet you refuse to share it. This is starting to turn into quite an interesting twist. Either (a) you don't care to assist FFers (in which case, why are you here, given you never give nor take advice from fellow FFers, and instead just spit out your WS uber alles mantra in every post?) or (b) you are under legal advice not to talk about that website or related matters.

And if this information was so useless, why were you and your friends so uninterested in it that it became an obsession, hitting that employee website thousands upon thousands of times? Obviously WS employees like Mark Hill, according to your argument, must have been pretty stupid.


;)



That provides WJ with the next round of growth. Then frequency goes up a little more, further erasing the so called S curve. Then AC loses more money. Then they cut back more money losing routes. WJ adds another burst of growth.

It's inevitable, and predictable. It's simply a continuation of the pattern since 1996.


Because nothing ever changes. Whatever has happened in the past, will always happen again. Great mantra to live by in business.

Simon

If you didn't get "Limited Addition", you most certainly were way, way down the totem pole, if you even were there at all.


Yes, I worked In-flight. Obviously humble 'way down the polers' are not worthy enough in the eyes of 'the management!'... great!


No wonder you're not at WJ. You were probably gleefully coached out.

;)

Is a personal attack really necessary? I guess it's indicitive of the culture at WestJet - if you dare to question anything, then better "coach 'em out fast!". I left WestJet to take up a position offering broader scope with another carrier. I don't have any grudge to bear with WestJet, and many friends continue to work there. More than, apparently can be said about your obvious axe to bear with Air Canada.

I find it so strange. I've worked for 5 carriers in 3 different countries. Everywhere else, from one airline to another, there was a common respect and courtesy to one another - even if you were 'competitors'.

Then, there's WestJet and Air Canada... with WestJet in particular having this apparent culture of "thy must despise the most evil of all enemies, Air Canada, and all it's brethren!". So Tragic.

Anyway, back on topic... if we can, without another anti-AC bashing session?

Cheers

:cool:

Ahem... "useless" proprietary information.

In which case, the "executive" doing it should have been fired for wasting company time. :D


;)

BTW, the aforementioned flight now has 25 empty seats in J. It leaves in about 4 hours.

You still haven't told me how to figure out if the flight is profitable or not.

How about an narrow body Airbus departing YYC in about 3 hrs with 28 coach seats remaining?

Will that flight make money? Tell us all how you'll figure that out?

At the same time, stand in front of the Keg and Red Lobster this evening, count how many people go in to each, and then tell us all which one is more profitable.


;) ;)

As Simon has already posted... CoffeeBean - if you have access to a site that provides accurate load information, it would be of great assistance to FT'ers... so please do share.

If, however, the system is an internal system provided by an airline for it's employees to accurately get load factors to assist them in pass riding - then this information is proprietary and it almost certainly violates the terms of use to post such information publicly.

I'm inclined to agree with Simon and others in that your constant 'snippets' of load factor information as a way of saying "look at me, I have access to this information and you don't!" is puerile and not in the spirit of the FT boards.

So, please do share this amazing site. Your refusal can only lead us to assume that you are improperly (and illegally?) using an internal employee system.

Cheers

:cool:

You still haven't told me how to figure out if the flight is profitable or not.

How about an narrow body Airbus departing YYC in about 3 hrs with 28 coach seats remaining?

Will that flight make money? Tell us all how you'll figure that out?


I've never professed to know that.

I will profess however to knowing that:

(a) WS has admitted that Mr. Hill did break into AC's proprietary systems and run thousands upon thousands of queries on load factor. As this is useless information why did y.. he do that?
(b) On large flights, load factors approaching zero (see YYZ-LGA, YYZ-LAX) can predict profitability very well.


At the same time, stand in front of the Keg and Red Lobster this evening, count how many people go in to each, and then tell us all which one is more profitable.


I'm as confused as everybody else about why you think I would know this. I have made two rather simple points above, not argued that load factor is an absolute predictor of airline profitability. You, on the other hand, would have us all think that CASM is.

And again, either prove that you wish to operate within the spirit of this board, by sharing useful information with other FF (the url of the website, which two weeks ago, you said was publicly available, but you weren't sure if it was still operating, and which now obviously is, should it exist, as you have just posted data from it), or admit that you have no desire to share useful information with other FF, are here purely to post WS diatribes and/or are forbidden for legal reasons to disclose this site due to a certain pending legal case.

Watch the dodges begin.

Simon

And again, given that this information is utterly useless, why did a certain close-at-hand ex-WS executive spend hours obsessed with it? Was he planning to use an employee pass? Or is he stupid? @:-)

And again, given that this information is utterly useless, why did a certain close-at-hand ex-WS executive spend hours obsessed with it? Was he planning to use an employee pass? Or is he stupid? @:-)

The words unethical, dishonest and crooked also come to mind.

...No wonder you're not at WJ. You were probably gleefully coached out.

;)

Well it certainly seems to a WS MO. Look how Clive Beddoe tossed out one of his fellow founding fathers to the sharks when it looked like he might be tarred with some of the spying fallout. There's loyalty for you :rolleyes: There's really nothing sadder than someone being tossed from an industry they obviously love, and forced to observe from outside the window,is there?

As Simon has already posted... CoffeeBean - if you have access to a site that provides accurate load information, it would be of great assistance to FT'ers... so please do share.

If, however, the system is an internal system provided by an airline for it's employees to accurately get load factors to assist them in pass riding - then this information is proprietary and it almost certainly violates the terms of use to post such information publicly.

I'm inclined to agree with Simon and others in that your constant 'snippets' of load factor information as a way of saying "look at me, I have access to this information and you don't!" is puerile and not in the spirit of the FT boards.

So, please do share this amazing site. Your refusal can only lead us to assume that you are improperly (and illegally?) using an internal employee system.

Cheers

:cool:

Figure out the key words,then use the magic of google. You need a computer with an internet connection and a heartbeat to access it.

Sorry, but that's all you'll get out of me. ;)

Except there's a 320 leaving YWG tomorrow with 77 empty seats......

Would WJ exist today without obsessive people in 1994? Perhaps if you were a little more obsessive, you might be a little more financially secure than you are today. ;)

Out of the business? Naw..... just out of the 8:00am to 8:00pm 7 day a week part of the business.

10 years is a long time to do that stuff. Who wants to be the only guy in your peer group with grey hair and a heart attack candidate in your early 40's. Not me.

There are two things to aim at in life: first, to get what you want; and, after that, to enjoy it. Only the wisest of mankind achieve the second.

Logan Pearsall Smith, Afterthoughts (1931) "Life and Human Nature"

;) ;)

Figure out the key words,then use the magic of google. You need a computer with an internet connection and a heartbeat to access it.

Sorry, but that's all you'll get out of me. ;)


And why is that? Why, when other FFers are explicitly asking you for help, with a tool that you would find useful, are you refusing? Forget "blah blah use google".

If someone on the AC site asks for help on a routing, do people respond: use expedia! Or do they help?

If someone on the AC site asks for information on the best way to earn SE status, do people respond: use google? At worst, they'll point them to a mileage forum.

In your case, you have now shown, after being explicitly asked by multiple FTers for the name of a site that will be useful to all of us, that you refuse to help FFers. You violate the entire purpose of FT.

Again, if you are prevented from talking about it due to AC's lawsuit against WS, just let us know. If not, there is no reason why a FFer would not help another.

Simon

There are several posts in this thread that have crossed the line of the TOS. Violations include personal attacks, discussion of moderator actions, and discussion of other posters.

I'm closing this thread for now until I have time later today to review some of the posts and determine what course of action is required.

FewMiles..
Moderator, WestJet forum

After review, the last few replies have had to be deleted because they were off-topic. Please stay on topic and do not seek to join those already on holiday. As a reminder, the topic is WestJet's 737-600s.

FewMiles..
Moderator, WestJet forum