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oresh Oct 31, 2007 11:59 am

[QUOTE=craz;8647394]

also CO last month had ZERO availability for Nov, Dec,Jan & Feb for Coach or BF awards that wasnt SleezyPass soon to be Standard Class excuse Me. And thats for the Low season why would you expect something to be available for the Summer time which is the Highest Season?
QUOTE]

That is strange because i'm flying on 11/14 to TLV and booked it last month. There were lots of open dates on Nov, Dec and Jan.

pbarnette Oct 31, 2007 12:41 pm


Originally Posted by xyzzy (Post 8652148)
channa's quote deals with redesigning BF. CO is not going to announce anything until it is ready to go with it. To do otherwise will result in disappointing a great many customers. Look at UA. They announced new seats and none were available on *any* flight. How many people looked at the ads and bought tickets expecting the new seat? I bet there were quite a few... I'd expect a newly updated BF offering at the time the 787 is introduced.

Except that I am not sure this necessarily contradicts dme. Everyone keeps saying that "CO will roll it out with the 787", but this doesn't really change the extent of the delay. I mean, if they are going to roll it out across the rest of the fleet, then why not start refitting the other long-haul planes now? There is nothing magical about the 787 requiring them to wait. They know the width of the plane. They have the promised loads. They have all the information that they need to design a seat and start putting it on the other planes. Even if adjustments need to be made, this isn't that different from the fact that they have differing seats between the 777, 767, and 757. And I struggle to believe that they are going to be going out of their way to design a seat whose weight pushes the theoretical limits anyway, so I would think they will be pretty darn safe.

Without some explanation of why it is critical to wait for the 787, then I'm inclined to side with dme and think that CO is waiting for the dust to settle before determining what sort of seat to offer. Nothing really wrong with that, I guess, but let's not dress up CO's financial and strategic prudence as some sort of customer-friendly initiative.

RobOnLI Oct 31, 2007 1:36 pm


Originally Posted by craz (Post 8647480)
OK maybe you arent aware of who CoInsider is, so just look at his signature below Post #1. whatever you read in that post is the Gospel according to CO if its there it will be in place as Scott posted.

So whatever is in Post #1 right now is not Open for discussion if it will be happenin or not, it WILL

Nope, I am well aware of who COInsider is. I mistakenly didn't look at page 1 (but a different page) before making my post in error.

Thanks.

-RM

Xyzzy Oct 31, 2007 1:55 pm


Originally Posted by pbarnette (Post 8653341)
Without some explanation of why it is critical to wait for the 787, then I'm inclined to side with dme and think that CO is waiting for the dust to settle before determining what sort of seat to offer. Nothing really wrong with that, I guess, but let's not dress up CO's financial and strategic prudence as some sort of customer-friendly initiative.

My understanding is that they have chosen the seat they intend to offer. Remember, these seats are not inexpensive. They can go for $50k each or more (often a lot more).

pbarnette Oct 31, 2007 2:21 pm


Originally Posted by xyzzy (Post 8653784)
My understanding is that they have chosen the seat they intend to offer. Remember, these seats are not inexpensive. They can go for $50k each or more (often a lot more).

I know they aren't cheap, but a cost-based argument does nothing to diminish dme's contention that CO is trying to string along their customers for as long as they can. I didn't say it wasn't sound, but waiting 3 years before seeing a new seat on CO isn't exactly a benefit for CO fliers, an idea some of the comments here were inching towards advancing.

TWA Fan 1 Oct 31, 2007 3:06 pm


Originally Posted by pbarnette (Post 8653919)
I know they aren't cheap, but a cost-based argument does nothing to diminish dme's contention that CO is trying to string along their customers for as long as they can. I didn't say it wasn't sound, but waiting 3 years before seeing a new seat on CO isn't exactly a benefit for CO fliers, an idea some of the comments here were inching towards advancing.

Agreed 100%. They know they're going to keep flying the 777's, the 757's and the 767's.

So what is the benefit of waiting 3 more years? Just to make a big splash with the 787? That seems a bit silly.

Plus, if they have really already selected their seat, the clock is ticking, it's getting out of date every day it sits on the shelf at BE Aerospace in Winston-Salem.

The only possible explanation is that L. (Cheapo) Kellner just wants to hoard his beans a little longer.

sbm12 Oct 31, 2007 3:23 pm


Originally Posted by pbarnette (Post 8653919)
I know they aren't cheap, but a cost-based argument does nothing to diminish dme's contention that CO is trying to string along their customers for as long as they can. I didn't say it wasn't sound, but waiting 3 years before seeing a new seat on CO isn't exactly a benefit for CO fliers, an idea some of the comments here were inching towards advancing.

I don't think that anyone will argue that old seats are inherently better than new seats, so CO not upgrading is a good thing for pax. CO not spending the money today means they can keep fares lower and remain profitable, which is good for us, but not necessarily the path they will choose.

With the existing product everyone knows exactly what they are getting. CO doesn't nee to buy the seats nordo they need to do the marketing blitz that would be associated with the change (also an expensive endeavor). If passengers start defecting to other carriers en masse CO will notice. But despite all the talk about it here people seem to still be flying CO sufficiently that the planes are pretty full up front, and those aren't EUA upgrades, so people are paying fr them with $$$$ or $$+miles.

pbarnette Oct 31, 2007 3:42 pm


Originally Posted by sbm12 (Post 8654343)
I don't think that anyone will argue that old seats are inherently better than new seats, so CO not upgrading is a good thing for pax. CO not spending the money today means they can keep fares lower and remain profitable, which is good for us, but not necessarily the path they will choose.

With the existing product everyone knows exactly what they are getting. CO doesn't nee to buy the seats nordo they need to do the marketing blitz that would be associated with the change (also an expensive endeavor). If passengers start defecting to other carriers en masse CO will notice. But despite all the talk about it here people seem to still be flying CO sufficiently that the planes are pretty full up front, and those aren't EUA upgrades, so people are paying fr them with $$$$ or $$+miles.

I'm a little confused... So you are saying that keeping the old seats is good news for pax? Am I misreading?

As for the planes being full argument... Everybody's planes are full up front, so I'm not sure that this is an indication that folks are really happy with the product. I know a lot of folks at my company who have flown Icelandair in J. Clearly, not everyone is doing much research into what they are buying, particularly when it is the company that is paying.

Finally, as to the profitability question. Bear in mind that the outlays for these seats do not immediately hit the bottom line. The P&L impact will only come later, hopefully corresponding with some measure of increased revenue that the seats will bring. And if the new seats will not bring any increased revenue, then why bother with new seats at all? And if they will, then why not drive the revenue growth now?

sbm12 Oct 31, 2007 4:27 pm


Originally Posted by pbarnette (Post 8654491)
I'm a little confused... So you are saying that keeping the old seats is good news for pax? Am I misreading?

I'm not suggesting that the old seats is good for pax, but I'm also not as convinced as you are that it is bad for pax.


Originally Posted by pbarnette (Post 8654491)
Finally, as to the profitability question. Bear in mind that the outlays for these seats do not immediately hit the bottom line. The P&L impact will only come later, hopefully corresponding with some measure of increased revenue that the seats will bring. And if the new seats will not bring any increased revenue, then why bother with new seats at all? And if they will, then why not drive the revenue growth now?

Well, there will be L now, as that is cost for the seats, and I'm sure the vendor actually wants to be paid for the seats when they are delivered, not when the carrier starts realizing the benefit of having the seats in place.

Hopefully the P comes along later, as CO gets more business and/or can charge a premium for the seats. If all the carriers (including CO) are full up front anyways, then the only way for the P to happen is if they raise fares. I'm not sure that is good for pax at all.

pbarnette Oct 31, 2007 5:07 pm


Originally Posted by sbm12 (Post 8654781)
Well, there will be L now, as that is cost for the seats, and I'm sure the vendor actually wants to be paid for the seats when they are delivered, not when the carrier starts realizing the benefit of having the seats in place.

Hopefully the P comes along later, as CO gets more business and/or can charge a premium for the seats...

This is cash flow, not profitability. Two separate issues.

sbm12 Oct 31, 2007 6:39 pm


Originally Posted by pbarnette (Post 8655100)
This is cash flow, not profitability. Two separate issues.

Yes and no. If the cost of installing the seats outweighs the additional revenue generated then over time profitability is affected by cash flow going in the wrong direction. If it cost CO some money this month, but they made it back next month that wouldn't be a big deal. Upgrading all the seats is giong to cost CO a lot of money over a long period of time, and the revenue potential of it is a very, very uncertain thing. It is a very big risk/gamble to make.

I think that a lot of the previous posts have minimized the significance of this, focusing on the idea that CO is going to lose a lot of business because the seats aren't as new and fancy as other carriers'. I'm disputing that claim and also claiming that I don't think the revenue is actually there to justify the upgrade today. The cost of the existing seats has to be amortized over some long period of time to make it pay, and CO hasn't hit that time yet.

I'd love new, fancy seats (though I don't fly much in BF, so it wouldn't affect me all that much), but it isn't a simple case of beign better for the pax and CO all at the same time.

TWA Fan 1 Oct 31, 2007 6:48 pm


Originally Posted by sbm12 (Post 8655667)
Yes and no. If the cost of installing the seats outweighs the additional revenue generated then over time profitability is affected by cash flow going in the wrong direction. If it cost CO some money this month, but they made it back next month that wouldn't be a big deal. Upgrading all the seats is giong to cost CO a lot of money over a long period of time, and the revenue potential of it is a very, very uncertain thing. It is a very big risk/gamble to make.

I think that a lot of the previous posts have minimized the significance of this, focusing on the idea that CO is going to lose a lot of business because the seats aren't as new and fancy as other carriers'. I'm disputing that claim and also claiming that I don't think the revenue is actually there to justify the upgrade today. The cost of the existing seats has to be amortized over some long period of time to make it pay, and CO hasn't hit that time yet.

I'd love new, fancy seats (though I don't fly much in BF, so it wouldn't affect me all that much), but it isn't a simple case of beign better for the pax and CO all at the same time.

If that argument holds as a matter of principle then why should CO invest in $80 million new planes?

Clearly, CO will not be able to charge a premium for customers to fly the 787. Yes, there will be savings in fuel, but those are minimal when compared to the tens of millions each craft will cost to acquire.

In fact, compared to a $70-100 million 787, $50k for a new BF seat seems like a minimal investment in order to modernize the product...

senatorgirth Oct 31, 2007 6:49 pm

CO not upgrading the BF seat is simply a reflection of the very conservative, follower-not-leader way the company is now run. That said, I don't have much of a problem with the current seat.

VideoPaul Oct 31, 2007 7:41 pm

In case anyone missed the significance of this, CO has once again proven that its frequent flyers are important to it by letting us know in advance what was going on. I'm tickled that CO Insider continues to keep us in the loop far more than other airlines do and continues to tolerate the whining and verbal abuse some posters lob his way.

They continue to impress me and I continue to buy tickets on their airline. Listening, AA and UA?

--PP

colpuck Oct 31, 2007 8:25 pm

It is not just the seats, they have to pull the a/c out of service and that takes revenue away from the bottom line. If co has to accommodate passenger changes planes because of the out of service that takes revenue away as well. Also they would be creating a new product and essentially a sub-fleet of a/c, one with old and one with new BF. Also continental is still marketing BusinessFirst as their premier product. There is no point in paying for advertising a product, when that is not the product delivered.

Constancy and uniformity are powerful motivators, much more so than any gives credit to. How, many times have people complained on this forum not that service was bad but it was inconsistent, and not uniform. I would imagine that on some level it is psychologically comforting to walk into a place an know exactly what you are going to find.

Airlines run on repeat business travelers, I predict you roll out a new seat right now CO would lose business, not because either product is bad, but because they are different. It makes sense to roll out the new seat with the new plane because then you can pump up the change for the future aspect. Right now it just seems like a stop-gap measure. Hell, if aint broke don't fix it.


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