USA Today Article on FLYI

 
Old May 9, 05, 6:35 am
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USA Today Article on FLYI

Like the photo

Link to USA TODAY Article

I thought the quote from Air Tran was interesting (grumble grumble

David
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Old May 9, 05, 6:59 am
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Independence Air doesn't get it - driving down airfares to cause higher-cost competitors to be unprofitable is fine - fair competition, that is, if you have a cost structure that enables you to be profitable. I have not seen anywhere that Independence Air's cost structure is anywhere near low enough to sustain such fares.
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Old May 9, 05, 8:23 am
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Originally Posted by UnitedSkies
Independence Air doesn't get it - driving down airfares to cause higher-cost competitors to be unprofitable is fine - fair competition, that is, if you have a cost structure that enables you to be profitable. I have not seen anywhere that Independence Air's cost structure is anywhere near low enough to sustain such fares.

This is exactly right. Sorry, but Indy's attempt at driving fares so low is just driving them right into the ground themselves. UA and US aren't going anywhere. They're not reducing WAS area service, and in fact both carriers are countering the attack with expansion (i.e. US's new DCA service to ATL, CLE, IAH, DTW, etc etc)
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Old May 9, 05, 8:47 am
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Actually UA and US are shrinking...

Originally Posted by GotCalcio4
This is exactly right. Sorry, but Indy's attempt at driving fares so low is just driving them right into the ground themselves. UA and US aren't going anywhere. They're not reducing WAS area service, and in fact both carriers are countering the attack with expansion (i.e. US's new DCA service to ATL, CLE, IAH, DTW, etc etc)
I hate to rain on your parade but according to the WSJ:
"US Airways April Mainlin Traffic Fell 0.2%

DOW JONES NEWSWIRES
May 4, 2005 2:14 p.m.

ARLINGTON, Va. -- Despite increased capacity, US Airways Group Inc.'s (UAIRQ) April traffic fell 0.2% and load factor weakened as the company faced tough comparisons to the year-ago period, which included the Easter holiday.

In a press release Wednesday, the air carrier said fuel prices and trends in traffic and revenue prompted it to schedule removal of 10 aircraft from its fleet as of its August schedule change."


AND:
"United Air April Traffic Fell 3.8%

DOW JONES NEWSWIRES
May 5, 2005 12:43 p.m.

CHICAGO -- April traffic at UAL Corp.'s (UALAQ) United Airlines unit fell 3.8%, on a 4% capacity drop, as dismal North American traffic offset overseas gains."


So even though Indy is making some cuts in the smaller markets with the regional jets, they are vastly increasing their reach this month with those 4 new Airbus destinations. Not to mention that they are also upping their service to some existing east coast cities from CRJs to Airbuses.
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Old May 9, 05, 9:47 am
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Originally Posted by DataBaseDude
I hate to rain on your parade but according to the WSJ:
"US Airways April Mainlin Traffic Fell 0.2%

DOW JONES NEWSWIRES
May 4, 2005 2:14 p.m.

ARLINGTON, Va. -- Despite increased capacity, US Airways Group Inc.'s (UAIRQ) April traffic fell 0.2% and load factor weakened as the company faced tough comparisons to the year-ago period, which included the Easter holiday.

In a press release Wednesday, the air carrier said fuel prices and trends in traffic and revenue prompted it to schedule removal of 10 aircraft from its fleet as of its August schedule change."


AND:
"United Air April Traffic Fell 3.8%

DOW JONES NEWSWIRES
May 5, 2005 12:43 p.m.

CHICAGO -- April traffic at UAL Corp.'s (UALAQ) United Airlines unit fell 3.8%, on a 4% capacity drop, as dismal North American traffic offset overseas gains."


So even though Indy is making some cuts in the smaller markets with the regional jets, they are vastly increasing their reach this month with those 4 new Airbus destinations. Not to mention that they are also upping their service to some existing east coast cities from CRJs to Airbuses.
All great, except Independence Air's entire network is on the east coast and to select west coast destinations. UA and US have networks that span the globe, and can better weather losses at their Washington area operations. One can even say that while not desirable, UA can lose its pants at IAD but you can't say the same for Indepdendence Air.
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Old May 9, 05, 11:31 am
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Rack up them losses please!

Originally Posted by UnitedSkies
All great, except Independence Air's entire network is on the east coast and to select west coast destinations. UA and US have networks that span the globe, and can better weather losses at their Washington area operations. One can even say that while not desirable, UA can lose its pants at IAD but you can't say the same for Indepdendence Air.
I don't recall UAs cash situation but a Journal article last week said that US had something like $300 million in cash until it falls into default with the ATSB. They claim that they are profitable now that they have screwwed their employees out of a retirement but I would prefer to wait and see with that.
Also US is being stalked on all fronts: PHL, PIT, WAS, CLT.
It's just a matter of time until the revenue from the high fares that they have been charging for years dries up after this recent waive of LCCs moving into their hubs.
I'm not sure how the CEO thinks that they will break even in the summer, but I would love to see it.
If not DH might go chapter 11 (I personally give it 50-50), but US is far more likely to go chapter 7, maybe not for a few months, but let SouthWest get some more 737s and they will be ready to finish US off.
WN is taking delivery of approx. 1 737 per week while US has already announced that they are cutting back on the number of big jets and kicking up the number of smaller jets.

As for UA, one good little strike by those F/As and kiss 'em buh-bye.
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Old May 9, 05, 12:12 pm
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We'll have to wait and see

Originally Posted by UnitedSkies
Independence Air doesn't get it - driving down airfares to cause higher-cost competitors to be unprofitable is fine - fair competition, that is, if you have a cost structure that enables you to be profitable. I have not seen anywhere that Independence Air's cost structure is anywhere near low enough to sustain such fares.
All of the numbers that we have all seen (unless someone here is an insider that I don't know about) include the old rates that DH was paying for their jets, they include a larger number of jets that they operate today, and they include things like legal fees and I would assume at least some layoffs given the number of aircraft that they are shedding vs. the number of Airbuses that they are adding.

The best numbers that any of us could go off of at this point are the April numbers. If anyone has 'em please post 'em.

While I believe that in the long run DH is going to make it (and hopefully without going into bankruptcy) I am just blown away by this comment in the article : "But Skeen said Independence is cutting costs and might break even this summer and turn a profit next summer."

That just seems really ambitious, and makes me wonder where they are getting the costs cuts from.
At any rate, if we all had numbers from April to look at we might be able to join in Kerry's sentiment, but until then we will just have to wait.
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Old May 10, 05, 4:51 am
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Originally Posted by UnitedSkies
All great, except Independence Air's entire network is on the east coast and to select west coast destinations. UA and US have networks that span the globe, and can better weather losses at their Washington area operations. One can even say that while not desirable, UA can lose its pants at IAD but you can't say the same for Indepdendence Air.
I agree with you about United. Before the divorce, ACA had a higher number of daily departures out of IAD than did United. United mainline's only substantive operation back then was their 1700 bank. It contained ten or eleven European departures and departures to a handful of cities that they only served once a day out of IAD. The 2100 bank included 3 European departures. The rest of the day, the C/D concourse was a ghost town.

US, on the other hand... You really think they can weather strong losses at DCA? They gave up on PIT, there's not a whole lot at CLT, and WN is killing them at PHL. What's left? DCA. If DCA takes it in the pants, what's US got left?
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Old May 10, 05, 3:08 pm
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Originally Posted by DHAST
US, on the other hand... You really think they can weather strong losses at DCA? They gave up on PIT, there's not a whole lot at CLT, and WN is killing them at PHL. What's left? DCA. If DCA takes it in the pants, what's US got left?
FL just moved into CLT last week and I wouldn't be suprised if they ended up expanding their service there.
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Old May 10, 05, 11:15 pm
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Originally Posted by DataBaseDude
FL just moved into CLT last week and I wouldn't be suprised if they ended up expanding their service there.
Don't forget DH increasing CLT service as well:

https://www.flyi.com/company/pressar...ar/032905.aspx

Starts next month.
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