Originally Posted by
BlueHorseShoe2000
Perhaps the most noteworthy news was that Frontier expects to shrink it's year-over-year capacity in MKE during Q3 and Q4 by 15% to 20% (for those interested, this was stated during the Q&A session with the analyst from Raymond James). It will be interesting to see what gets cut.
At least for Q3, that level of year-over-year cuts is already in the schedule.
Generally when industry people talk about capacity, they talk about available seat miles. Looking at August 2011 versus August 2010, ASM’s at Milwaukee are down 22.9% year over year. The reduction of long-haul west coast flying is a huge portion of this.
I took the weekly flights last August and compared them to the weekly flights scheduled this August.
2010 weekly ASM’s
30.7 million
2011 weekly ASM’s
23.7 million
All of that reduction is accounted for in these six dropped or reduced markets:
-2.38m LAX (10x/week fewer 319)
-1.51m SFO (6x/week fewer 319)
-1.14m SAN (7x/week 319 replaced by 3x/week 190)
-0.71m ATL (6x/week fewer E170 and 12x/week fewer ERJ)
-0.68m RDU (13x/week fewer E170)
-0.57m TPA (7x/week fewer E170)
All of the other additions and reductions year-over-year net to zero ASM’s.
The 22.9% August reduction is probably right about what July will see. As things currently stand, September year-over-year looks to be off about 13.1% in ASM’s. (That's because last September had seasonal drop-offs to the west coast...this September there's very little west coast for a seasonal drop-off.) That would put the 3rd quarter ASM’s down in Milwaukee between 19% and 20% with the current schedule.
Before this past weekend’s cuts, August ASM’s were already planned to be down about 13%. When summer was originally loaded a couple months back (including 7x SAN Airbus ) Milwaukee ASM’s were looking to be down about 4% year over year.
Back to the August numbers. I listed the six biggest ASM reductions year over year. Here are the six biggest increases:
+0.56m Denver
+0.47m Hartford
+0.44m Washington
+0.32m San Antonio
+0.17m Boston
+0.08m LaGuardia
So…I don’t think that the comment that Q3 and Q4 will be down about 15%-20% in MKE means there are more cuts coming for July/August/September. And that makes some sense, considering that they just loaded what is expected to be the final summer schedule. That’s no assurance that there won’t be additional September trims, but they are needed to meet the “MKE down 15%-20% year over year” guidance.
I’ll work on the Q4 numbers to see how things look.