The main idea here, at least to me, is that the airline industry is right up there with the automobile industry as the most unimaginative industries in the world right now...and any problems that they are having are 100% of their own doing.

LK and others have expressed the same thoughts...that the model is broken, but it is of their own making. :-:

Let's look at the airline industry: other than lowering the price of a ticket from time to time, what innovations have they come up with lately? The upstarts have been the only ones with new ideas (Southwest: simple pricing structure, Virgin America: updated cabins, etc), but the legacy carriers are stagnant and reactionary. It's just like the auto industry. The Chevy Volt? C'mon...that should have been out 10 years ago, and I think that the success of the Toyota Prius is an example of what customers will buy if you don't make it look like something out of the Jetsons.

Same deal with the airline industry. I do not fly WN unless my schedule damends it, because I just don't like their way of doing business -- mainly no seat assignments. However, they were the first airline after deregulation to do things differently, and now they have become a kind of quasi-standard, with pitiful legacy carriers like US trying to emulate them -- with absolutely no success. On the flip side, WN's basic business model (we get you from point A to point B, no frills...basic) have allowed it to differentiate itself currently, when it was basically they way that they were conducting business in the first place.

CO had a watershed moment when it introduced BusinessFirst, and its moves during that time of it's existance really helped it become the airline it is in today. I tell people that the reason that I am so loyal to CO isn't that they do something far and above everyone else...you don't get a $100 bill or something like that when you step on board......but that they do 100 things 3% better than everyone else, and that makes them better. They're still way better than UA, US, AA, DL, NW, and yes, even WN in almost all facets, IMO, but the differing labor cost structures of those airlines post-bankruptcy have changed the rules a bit, and CO's previous (and admirable) business structure prevented it from going belly-up, but now they are at a distinct cost disadvantage as compared to UA, the new DL, etc...just because they did things right.

That being said, methinks that it will be essential for CO to make a splash these days in order to stay in front. E+, improved Y product, or something similar while staying in line with the rest of the industry with regard to fares will be essential...but mereallythinks that CO will be part of another airline and/or merge with someone else soon This joining *A is cool, but as the article says...CO will have "an additional relationship with UA" beyond that, which translates to me that they are going to attempt to bring their systems and practices into line with each other over the next couple of years, and then merge...thus avoiding the merger mess US Airways/AmericaWest had, and the ones that DL/NW are just now beginning to have.

Not that it will be a bad thing, but mealsothinks that it will be hard to operate that large of an organization and keep those 100 things 3% better than the competition. Tough time for them and everyone else....