Upcoming AS Route Cuts
Feb 22, 2018, 11:12 pm
#91
Join Date: Apr 2009
Location: YYF/YLW
Programs: AA, DL, AS, VA, WS Silver
Posts: 5,951
Pretty sure I’m right. I’m not using the simple pre-tabulated T-100 stats that sometimes get thrown around here (e.g. from the SFO Wiki page above). When we were talking about this same topic ~6 months ago I went and downloaded the DB1B O&D data, which comes from a 10% ticket sample, and wrote some quick code in Stata to aggregate it up to the market (MSA) level. Unfortunately I’m not sure that I kept it around, so all I have at the moment is what I documented in my former posts, but I’m confident that those were accurate.
(The Wikipedia page is just [accurately] tabulating the BTS data. So the statistics are accurate as far as they go, but they're not the O&D data that you've sampled -- important to know what statistics one is quoting!)
Feb 23, 2018, 6:08 am
#92
Join Date: Nov 2001
Location: Portland, Oregon
Programs: Hilton Platinum, Alaska MVP Gold
Posts: 2,363
Yup. And Northwest/Delta built the TPAC focus city then hub before they started going head-to-head domestically with AS. And SEA-touching flights even now can't be more than 10 or 20% of DL's operations; whereas SFO and SEA each account for a far larger share of AS+VX's operations: there's a heck of a lot less risk in building something up when it's a few percent of your operation than when it's 25%.
Feb 23, 2018, 9:43 am
#94
FlyerTalk Evangelist
Join Date: Nov 2013
Location: Los Angeles
Posts: 12,598
Feb 23, 2018, 10:01 am
#95
Join Date: Nov 2015
Location: SNA/LAX, PHL
Programs: AA Gold, AS MVP, WN A-List, Hilton Gold, Hyatt Exp, Hertz PC
Posts: 449
Feb 23, 2018, 1:13 pm
#98
Suspended
Join Date: Mar 2014
Posts: 1,684
Pretty sure I’m right. I’m not using the simple pre-tabulated T-100 stats that sometimes get thrown around here (e.g. from the SFO Wiki page above). When we were talking about this same topic ~6 months ago I went and downloaded the DB1B O&D data, which comes from a 10% ticket sample, and wrote some quick code in Stata to aggregate it up to the market (MSA) level. Unfortunately I’m not sure that I kept it around, so all I have at the moment is what I documented in my former posts, but I’m confident that those were accurate.
No, I didn’t. For several years my own plan was to make 1mm on UA and then move as much travel to VX as possible, retaining lifetime Gold status on UA for markets not served by VX. However, the AS/VX merger, combined with the depressing thought of having to travel several hundred thousand more miles on UA, made me jump ship early. It’s too early to judge whether I can make it work, but frankly I’m more concerned at this point that AS seems to have no strategy at all, at least wrt CA. Whether I can make the AS network work is somewhat irrelevant if AS can’t make the business work in CA, period. The only positive is that if AS fails entirely, someone else (presumably B6, DL, or AA) with a better network will come in and use the vacated AS gates to make SFO at least a focus city.
As has a good program, but their website is horrible for finding redemptions and flights available for upgrade are few and the upgrade costs are typically 3x the base fare at least.
Feb 23, 2018, 1:14 pm
#99
Join Date: Apr 2009
Location: YYF/YLW
Programs: AA, DL, AS, VA, WS Silver
Posts: 5,951
B6 establishes its first base in JFK, which is such a large market that it can’t really be compared to DL moving into SEA.
BOS is pretty comparable to SEA in size (or at least was before DL built up SEA) and in geography (being in the corner of the country, so limited in domestic connection opportunities). But B6 moved in after AA essentially ended their focus city operation in favor of the cornerstone strategy. So BOS was devoid of a carrier with a broad network and therefore ripe for a lower-cost airline that can appeal to upper middle class leisure travelers (a market that I think all three of VX, B6, and AS are more focused on that the big three). There really aren’t any similar opportunities for AS/VX at this point, at least not ones that are obvious to me. So I don’t think it’s fair to say that AS/VX are failures for being unable to move into SFO and build up a profitable and loyal base as quickly as B6 did in BOS/JFK and DL did in SEA (which was the genesis of this side conversation).
Feb 23, 2018, 1:26 pm
#101
FlyerTalk Evangelist
Join Date: Aug 2007
Location: SEA, but up and down the coast a lot
Programs: Oceanic Airlines Gold Elite
Posts: 20,396
That's basically my point. AS hasn't even completed the integration yet. Bit early to say "nah, they hack off the VX network and concentrate on Bay Area secondary airports (which they could have continued to do BEFORE the merger and spent $0 to continue to do so, instead of 2.6 billion)".
Feb 23, 2018, 1:36 pm
#102
Original Poster
Join Date: Apr 2003
Programs: B6 Mosaic, Bonvoy LT Titanium (x SPG LT), IHG Spire, UA Silver
Posts: 5,848
That's basically my point. AS hasn't even completed the integration yet. Bit early to say "nah, they hack off the VX network and concentrate on Bay Area secondary airports (which they could have continued to do BEFORE the merger and spent $0 to continue to do so, instead of 2.6 billion)".
This is precisely the dilemma faced by AS in the Bay Area. Both options are not great for them. They either continue as they are and lose money/make very little profit in the region or they revamp everything with a product that is not substantially different than their much larger competitors. They are between a rock and a hard place. Also, they are such a conservative/cautious company, I don't see them reinventing themselves/taking big risks anytime soon. Thus they will probably limp along for a few years and see how things pan out.
Feb 23, 2018, 2:05 pm
#103
FlyerTalk Evangelist
Join Date: Aug 2007
Location: SEA, but up and down the coast a lot
Programs: Oceanic Airlines Gold Elite
Posts: 20,396
As I said, I am not convinced LAX (or DAL, I guess) are particularly stronger than SFO as it comes to yields. Historically VX starts more routes out of SFO than LAX (which indicates that SFO is the stronger of the pair). Also, you have a LOT of nonstop choices out of LAX, not just UA and AS/VX.
So if you mean "across the VX network", sure. If anything I'd expect if AS was going to trim the VX network, it would probably go something like:
- sell/get rid of LGA and DCA slots, use DAL similar to how AS uses OAK/BUR (as an alternate spoke airport in the metro area) and start some LAX/SFO-DFW flights to get some usage out of the DFW station, adjust DAL accordingly.
- trim lower yielding SFO/LAX flights, turn in as many A320s/A319s as you can as fast as you can, kill off as many A321 orders as you can, use the B73Max/B739s on order plus some OO/QX capacity to backfill the ex-VX planes going away (you could also start flying them on West Coast ex-mainline routes like SFO/SAN/LAX/SJC-SEA as a way to manage capacity/pricing... though you hand some market to DL that way).
Basically AS would slam the brakes on expansion across their network like VX had to at various times. The stock would get crunched since it's quite a different story than one they were selling to analysts post-VX acquisition. Probably a career-ending event for some AS execs.
So if you mean "across the VX network", sure. If anything I'd expect if AS was going to trim the VX network, it would probably go something like:
- sell/get rid of LGA and DCA slots, use DAL similar to how AS uses OAK/BUR (as an alternate spoke airport in the metro area) and start some LAX/SFO-DFW flights to get some usage out of the DFW station, adjust DAL accordingly.
- trim lower yielding SFO/LAX flights, turn in as many A320s/A319s as you can as fast as you can, kill off as many A321 orders as you can, use the B73Max/B739s on order plus some OO/QX capacity to backfill the ex-VX planes going away (you could also start flying them on West Coast ex-mainline routes like SFO/SAN/LAX/SJC-SEA as a way to manage capacity/pricing... though you hand some market to DL that way).
Basically AS would slam the brakes on expansion across their network like VX had to at various times. The stock would get crunched since it's quite a different story than one they were selling to analysts post-VX acquisition. Probably a career-ending event for some AS execs.
Last edited by eponymous_coward; Feb 23, 2018 at 2:18 pm
Feb 23, 2018, 2:16 pm
#104
Original Poster
Join Date: Apr 2003
Programs: B6 Mosaic, Bonvoy LT Titanium (x SPG LT), IHG Spire, UA Silver
Posts: 5,848
As I said, I am not convinced LAX (or DAL, I guess) are particularly stronger than SFO as it comes to yields. Historically VX starts more routes out of SFO than LAX (which indicates that SFO is the stronger of the pair). Also, you have a LOT of nonstop choices out of LAX, not just UA and AS/VX.
So if you mean "across the VX network", sure. If anything I'd expect if AS was going to trim the VX network, it would probably go something like:
- sell/get rid of LGA and DCA slots, use DAL similar to how AS uses OAK/BUR (as an alternate airport) and start some LAX/SFO-DFW flights
- trim lower yielding SFO/LAX flights, turn in as many A320s/A319s as you can as fast as you can, use the B73Max/B739s on order plus some OO/QX capacity to backfill the ex-VX planes going away (you could also start flying them on West Coast ex-mainline routes like SFO/SAN/LAX/SJC-SEA)
Basically AS would slam the brakes on expansion like VX had to for years. The stock would get crunched. Probably a career-ending event for some AS execs.
So if you mean "across the VX network", sure. If anything I'd expect if AS was going to trim the VX network, it would probably go something like:
- sell/get rid of LGA and DCA slots, use DAL similar to how AS uses OAK/BUR (as an alternate airport) and start some LAX/SFO-DFW flights
- trim lower yielding SFO/LAX flights, turn in as many A320s/A319s as you can as fast as you can, use the B73Max/B739s on order plus some OO/QX capacity to backfill the ex-VX planes going away (you could also start flying them on West Coast ex-mainline routes like SFO/SAN/LAX/SJC-SEA)
Basically AS would slam the brakes on expansion like VX had to for years. The stock would get crunched. Probably a career-ending event for some AS execs.
ALK's stock has already gotten slammed and is not going to be rising anytime soon given the current state of the business. They either need to take a big risk or just flounder along and hope for the best.
Feb 23, 2018, 2:21 pm
#105
FlyerTalk Evangelist
Join Date: Aug 2007
Location: SEA, but up and down the coast a lot
Programs: Oceanic Airlines Gold Elite
Posts: 20,396
Yeah, which is why "ditch SFO for LAX" is so peculiar an argument. It's HARDER to make money on a route when five airlines fly it, not just two. Look at how many times SJC-LAX has been a flop for AS (and it was one for VX, too)- or LAX-CUN (flop for both AS and VX).
No, I mean it would get crunched worse than it has been if AS basically says "we're looking at shrinking the VX network and taking a few years off from any capacity growth overall".
Taking on a VX network that was always marginal compared to everyone else's (and in a lot of markets outside of transcon where a super premium VX F product was probably not the right product choice) WAS the big risk.
If anything I think AS is adjusting to the realization that B6 is eating the world when it comes to premium transcon, and you don't get much halo and positive vibes from "we're watering it all down, but it might be cheaper (someday, just not today) and easier to upgrade to".
If anything I think AS is adjusting to the realization that B6 is eating the world when it comes to premium transcon, and you don't get much halo and positive vibes from "we're watering it all down, but it might be cheaper (someday, just not today) and easier to upgrade to".
Last edited by eponymous_coward; Feb 23, 2018 at 2:31 pm