AngryPM

I really think that they have it wrong. SW, AT, JB and all the other low-fares have not discovered a revolutionary airline model, they simply have drastically younger labor agreements. That translates to lower operating costs.

Where the majors miss the point is that no matter how much they cut service their "built-in" costs will never allow them to compete head to head with the low-cost guys. So why bother? Why not differentiate your product by service and quality for the extra cost? Why lower your service to the same level as SW, AT, and JB but still charge $100+ more for the same ticket? or offer the same price fare and lose money? Neiman's does not try to match prices with Walmart.

IMhumbleO as a PM on Delta, that is why I am enraged over the additional reduction in service proposed by the new medallion rules, above and beyond the numerous reductions in service, value, and quality over the past 5 years I have been flying.

gilpin

The majors not only have higher labor costs but must bear the expense of their inefficient hub-and-spoke systems. Takeoffs, landings, and gate operations all consume cash.

This is an area where the majors could conceivably economize by adopting the point-to-point model. They don't because the hub-and-spoke system supports fortress hubs and their higher fares. Isn't Song primarily a point-to-point operation which bypasses Atlanta customers?

RobertS975

DL Express was already a hub bypass. As far as fortress hub fares, Air Tran has already taken care of much of the ATL hub fortress fares, WN does the same at SLC. As far as CVG, I would be curious as to what % of DL pax connect there as opposed to O/D at CVG.

gilpin

Good points Robert, Delta Express was a previous attempt at the same goal. I don't know exactly how AirTran has impacted ATL fares, but I always imagined DL has assumed they will be able to drive them out of business (using a limited number of "T" seats), just as AA did with Braniff and Legend. In regards to SLC, hasn't DL threatened repeatly to downgrade it as a hub, and in fact reduced service in recent years (although not as much as they've gutted DFW)?

I do recall reading a while back that CVG had the highest ticket cost per pax mile of any US airport.

FrequencyFlyer

And in my opinion drastically inexperienced labor skills and capabilities. I personally think that low cost carriers are playing russian roulette with their equipment and that their owners are probably very willing to take that risk... all for the sake of the almighty dollar. I fail to see how an airline can be prudent when it only charges a measly fee for an expensive solution.

gilpin

I don't see how anyone could characterize WN's pilots or maintenance as inexperienced or not capable. They're hardly new on the scene and I believe they have an excellent safety record.

FrequencyFlyer

This is true, but the do have bad paint. I wouldn't pay $300K for a ugly house, and I feel the same with my $300 for travel.

ConcordeBoy

According to the 2002 Aviation AeroSpace Almanac*; CVG isnt even in the top 20 O&D airports in the USA!

This means that even such non-hubs as PDX, MSY, and TPA all have more O&D than CVG; and that's gross numbers, not per capita.

But of course, more O&D doesnt automatically signify higher-yielding O&D


*Lampl, Richard; McGraw-Hill, NY, NY

CelticFlyer

Last figures I saw were around 30% overall PAX local but only 24% of DL's PAX local. Of course DL has been changing the profile of the CVG operation so these figures are probably ballpark at best now.

Donna D

Comair is a good example of how Delta managed to screw things up. Before they got the larger jets and started flying all over the place - it was great - pretty much always on time [barring an afternoon Florida rainstorm] and dependable. There was no worry about what was happening in another city a couple of states away. Now, its a nightmare and getting to the point where its not really worth commuting around Florida in a plane any longer. Planes are more often than not very late now, with a lot of cancellations. The last 3 trips I took to Ft Myers, I have ended up having to drive home.

Of course, last week when my flight was cancelled due to weather in another state they informed me that they would be happy to put me on the next flight - the following day. I said no thanks, I will just drive home. When I told them to refund that portion of the ticket she actually said to me, "I don't think we can do that ... the weather is not our fault." After asking someone she came back and said yes, it will be refunded.

I think they have gotten rid of anyone with knowledge at SMS and replaced them with min. wage workers - it seems you now have to call back 5 or so times till you find the right person to talk to.

zrs70

Sorry for my ignorance, but what airlines are "SW, AT, and JB"?

AngryPM

I meant Southwest Airtran and Jet Blue

Mountain Trader

It's a lot more than just getting the labor costs back to market.

The whole game of trying to sell to the high-end, "****-the-cost" business traveller is over. Correction: The game isn't over, but no one is playing-the business travellers left more than two years ago. What's left now are frequent travellers, most on cheap billets, soaking up upgrades and free trips. The airlines are broke without the high price tickets being sold, and the remaining customers are pissed that they can't get an upgrade or free flight (read these boards-the angry mobs threaten billboard action. I bet Delta is just sooooo worried).

Airline travel will cost most travllers a lot more in the future. That $250 roundtrip will be $400-450. And the FF benefits will be much less, because the value to the airlines of loyal patronage will be much less (and, I predict, dollar-based). And, yes, the labor costs will also be a lot lower.

FrequencyFlyer

MT you hit the nail on the head, yet again.

Tristan

This is a misconception taken as fact in many media reports. I've seen it reported more than once that over 95% of cities that can support point-to-point service already have it.

You will never be able to fly point-to-point from Des Moines to Savannah. Hub-and-spokes are not an outdated model for an airline. They are, and will continue to be, a necessary and efficient way to provide air service from small and medium sized communities to other small and medium sized communities.