Originally Posted by
iahphx
By merging and cutting capacity about 10%, the idea is to get the average fare up. Bye-bye to "excess" inventory and junk fares. This is obviously bad for mileage runners and others who like to buy rock-bottom tickets (including me!), but good for airline profitability.
Overcapacity is a myth. It's a matter of what you do with it.
And the "cut, run, and hide" routine has failed the entity known as "US Airways" for the better part of the last 20 years. The DL merger thing is a perfect example--Parker assumes he will be able to extract the pound of flesh from the east coast markets without LCC competition.
Of course, this is the same think that said:
1. Southwest will never go to X (where X=northeast in general, BWI, the carolinas, PHL, PIT, upstate new york).
2. LCC's won't ever fly to major and congested airports. There won't be an LCC in NYC proper, or BOS, or Washington proper.
And so forth. B6 is buying 190s for a reason--to get into midsize markets. Sooner or later, LUV's going to need to buy a smaller airplane. LCC will run out of places to run and hide, or have no decent domestic network left (and they would arguably be the weakest of the majors following the consolidation that would follow the DL deal actually happening).
And, beyond that, Parker's going to have to run the airline. I'm guessing he won't get past merging HP and US, much less those two plus DL.
This is all moot. The DL pilots can stop all of this--not with their claims, but with their contract. Unlike the lemmings at US, these guys (DALPA) will do it.