Originally Posted by
Adelphos
Why would Alaska buy Virgin, then remove the only advantage it had on many of the Virgin routes just as competitors like B6, AA, United, DL are adding a lot of capacity on these same routes? On transcons, Virgin is far behind all competitors in the premium cabin and more expensive than competitors in economy.
Then to switch to the Alaska product which takes away what little differentiation VX has while raising wages up up to AS levels just sets up a financial disaster. The conference call made it seem like management at Alaska still does not know what they spent billions of dollars on or how they are going to make the VX network profitable. After much prodding by analysts they said they would be looking at the VX network at some point in the future. They really sounded like they had no idea what they were doing.
Competition is increasing every day and the only strategy they have implemented in California is to add a bunch of new routes and hope that people pay for it and that there are enough pilots to fly them.
They are getting killed on transcons and intra California flights now and it will just get worse with the AS product and giving away premium seats. They are not going to make money as the bottom feeder carrier from California.
UA’s conference call was panned last week but the one for ALK today made the UA management team look like geniuses.