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As Southwest Airlines Enters Hawaii, Alaska Airlines May Be the Biggest Loser

As Southwest Airlines Enters Hawaii, Alaska Airlines May Be the Biggest Loser

Old Feb 26, 18, 12:00 am
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As Southwest Airlines Enters Hawaii, Alaska Airlines May Be the Biggest Loser

Interesting article on the situation Alaska will face as southwest enters the Hawaii market.

https://www.fool.com/investing/2018/...-airlines.aspx

The passage I found most interesting:
In recent months, Alaska Air's management has emphasized that it will be aggressive in cutting capacity when necessary to improve profitability. In the long run, Alaska may significantly reduce its capacity from California to Hawaii if Southwest's growth puts too much pressure on pricing and load factors. Alaska Airlines could even exit the Oakland-Hawaii market entirely, as it doesn't seem to have a competitive advantage there relative to Southwest Airlines.
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Old Feb 26, 18, 12:19 am
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Looks like AS has plenty of time to figure it out, as it's possible WN won't even sell a ticket until early 2019, let alone begin service:

https://www.bizjournals.com/dallas/n...hts-up-in.html

Kelly said heís hopeful that Southwest will be flying to Hawaii by the end of 2018, but if itís not, heís confident the airline will at least be selling tickets for flights that start in early 2019.
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Old Feb 26, 18, 12:27 am
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I would never consider flying WN to Hawaii but I do hope the prices return to reasonable levels again...I paid over $400 one-way for a LIH-PDX ticket (via SEA) which I thought was outrageous and is the main reason I've been avoiding Hawaii trips in favor of PVR.
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Old Feb 26, 18, 12:48 am
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Originally Posted by PDXPremier View Post
I would never consider flying WN to Hawaii but I do hope the prices return to reasonable levels again...I paid over $400 one-way for a LIH-PDX ticket (via SEA) which I thought was outrageous and is the main reason I've been avoiding Hawaii trips in favor of PVR.
Hawaii itself is getting more expensive it seems too. Lodging seems to have shot up 50% in the past couple of years (based on a fairly small sample set) but I do try to keep my costs in check. At least its harder to find a deal these days.

Saw the article earlier. WN has been saying it would start Hawaii for years... yes they are probably getting closer it would seem. Whereas AS has entered its second decade of service.
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Old Feb 26, 18, 12:53 am
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WN is going to Hawaii. Itís not a matter of if anymore. The ETOPS pilot training will start soon and the FAA ETOPS program review is well underway already. First proving runs should start in the fall, I believe.

Originally Posted by beckoa View Post
Hawaii itself is getting more expensive it seems too. Lodging seems to have shot up 50% in the past couple of years (based on a fairly small sample set) but I do try to keep my costs in check. At least its harder to find a deal these days.
The economy is doing well and people are going on vacation. I remember heading over for the 4th of July in 2013 and paying $150/night for the Hyatt in Kauai and $175/night for the Grand Wailea. Not anymore, sadly.

Donít even get me started on the development thatís planned for parts of Maui. It absolutely breaks my heart.
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Old Feb 26, 18, 12:58 am
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Originally Posted by tusphotog View Post
WN is going to Hawaii. Itís not a matter of if anymore. The ETOPS pilot training will start soon and the FAA ETOPS program review is well underway already. First proving runs should start in the fall, I believe.
Fair enough... haven't kept up with this as its been rumored for soo long.

HA is having its own internal issues now:

https://www.hawaiianairlines.com/not...ule-adjustment

https://www.sfgate.com/chris-mcginni...f-12704798.php

[As found on airliners.net]
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Old Feb 26, 18, 2:05 am
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And HA is expected to announce that it will buy 6 Boeing 789s and cancel its order for the same number of Airbus A330-800neos.

https://finance.yahoo.com/news/hawai...201000588.html
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Old Feb 26, 18, 9:47 am
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WN marketing keeps dangling the Hawaii carrot, riling up such prestigious media outlets (sarcasm emoji). Meanwhile, AS is building brand loyalty to Hawaii with its credit card free checked bags and companion certs, relaxed size and weight limitations for sporting goods.

Not unusual to see East Coast, one-stop West Coast Hawaii fares on AA/DL/UA that are less than AS nonstops from the West Coast - does not seem to prevent AS from filling flights out of SAN. I have also noticed the 12-seat first class cabin selling out to Hawaii, in advance of the elite upgrade window; interesting to find a handful of kids sitting upfront (same for MCO).
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Old Feb 26, 18, 10:19 am
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It seems inevitable that AS would leave at least OAK-Hawaii once WN enters. It is however another step in the wrong direction for #mostwestcoast . They can't seem to figure out what to do at SFO and they would be ceding the 4th largest airport in the state almost entirely to WN. This would be 2+ years after buying VX and deciding to make a real play for California's business, when they should be ramping up, not down.
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Old Feb 26, 18, 10:28 am
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First of all, I think Southwest will enter the market with lower fares than AS currently offers. However, except for an introductory splash, I don't expect that fares will be DRAMATICALLY lower over the long-term. Southwest is no longer a "discount" airline and sometimes charges more than other major carriers. Will there be a downward trend in West Coast-Hawaii airfares? Yes, but don't expect huge discounts over the long-term.
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Old Feb 26, 18, 10:33 am
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Originally Posted by ryandc99 View Post
Interesting article on the situation Alaska will face as southwest enters the Hawaii market.

https://www.fool.com/investing/2018/...-airlines.aspx

The passage I found most interesting:
Alaska is doing assigned seats, F cabins, extra legroom seats, power at seats, and meal service or BOB. Those are non-trivial advantages on flights that are scheduled at 5 /12 hours.
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Old Feb 26, 18, 11:55 am
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Originally Posted by 3Cforme View Post
Alaska is doing assigned seats, F cabins, extra legroom seats, power at seats, and meal service or BOB. Those are non-trivial advantages on flights that are scheduled at 5 /12 hours.
they maybe of value to alaska ff but to most people having a free checked bag on wn will trump all of the above (even more so than on transcons as ppl seem to pack kitchen sinks on hi flights)
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Old Feb 26, 18, 12:10 pm
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Originally Posted by 3Cforme View Post
Alaska is doing assigned seats, F cabins, extra legroom seats, power at seats, and meal service or BOB. Those are non-trivial advantages on flights that are scheduled at 5 /12 hours.
The competitive dynamics will be different at different airports; the above is not likely to make the difference at a place like OAK where WN has much larger FF base and feed. SD, SJ will be more interesting.
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Old Feb 26, 18, 12:55 pm
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Originally Posted by azepine00 View Post
they maybe of value to alaska ff but to most people having a free checked bag on wn will trump all of the above (even more so than on transcons as ppl seem to pack kitchen sinks on hi flights)
That's certainly true. But I suspect that the credit card companion fare is huge for a lot of families going to Hawaii. That and the 60+ day no change/cancellation fee make me willing to pay a premium in base fare on AS over the competition, since it's still cheaper overall. (Of course, that means that AS actually collects less than the airfare, but still gets the credit card revenue and ensuing tendency for passengers to prefer AS.) And if you have the companion certificate, of course you have the credit card and no change fee.

Now WN is still better than AS on both the change fee (always waived, not just 60+ days) and bags (2 vs 1). But the credit card significantly limits WN's advantage at least in markets where AS has strong credit card penetration (ie Northwest, absolutely; less so in CA, at least for now).
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Old Feb 26, 18, 1:22 pm
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Originally Posted by 3Cforme View Post
Alaska is doing assigned seats, F cabins, extra legroom seats, power at seats, and meal service or BOB. Those are non-trivial advantages on flights that are scheduled at 5 /12 hours.
And WN has free checked bags and for a large bucket of seats, redeeming WN points is straightforward compared to "well, I hope AS opened the W bucket" redemptions.

Fun fact I saw on VFTW: Nearly 14% of WN's miles are flown using awards. That's really good: it's better than AA (~6%), DL or UA (~8%). (Don't know what the AS figure is.) Unless WN doesn't ever open WGA buckets on Hawaii (doubt that). they're going to be a popular FF redemption that's quite achievable.

Yeah, I know, the FT cognoscenti go all at WN. But fact of the matter is there's a reason why traditional FF programs and credit cards with a free checked bag didn't stop WN in the 1990's and 2000's from building up a 700+ plane fleet. For infrequent to moderately frequent flyers, WN offers real value.

Originally Posted by ashill View Post
Now WN is still better than AS on both the change fee (always waived, not just 60+ days) and bags (2 vs 1). But the credit card significantly limits WN's advantage at least in markets where AS has strong credit card penetration (ie Northwest, absolutely; less so in CA, at least for now).
So what about the WN Companion Pass? Seems like that'll be pretty killer once Hawaii opens up.
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