San Juan it is!
Sep 30, 2005, 6:42 am
#16
Join Date: Jan 2003
Location: between DCA and BWI
Programs: SPG Gold, Hyatt Plat, UA Premier, Hilton Gold
Posts: 3,652
Would something like $169 be enought to make it profitable? I mean we know that other airlines charge $200, but do we know if they actually make $$$$ on this route?
Originally Posted by Cohiba
Interesting that there have been a couple posts along this line. The move IS a smart business move. However, instead of just offering rhetoric, let's look at some facts.
DH is currently achieving a paltry average fare on West Coast routes, barely over $100 for 5.5 to 6 hours of flight time and fuel burn. The SJU run will clock in at around 3:45 of flight time / fuel burn. Is anyone else aware of the average fare for the WAS-SJU market? It is around $200.
Now, I know the naysayers will chime in with the old rhyme that DH will only dilute this market and knock down the average fare. However, the lowest fare available at 11 weeks out is $169 according to flyi.com. The logic suggests that these fares will sell and SJU will be a profitable market.
Cheers.
DH is currently achieving a paltry average fare on West Coast routes, barely over $100 for 5.5 to 6 hours of flight time and fuel burn. The SJU run will clock in at around 3:45 of flight time / fuel burn. Is anyone else aware of the average fare for the WAS-SJU market? It is around $200.
Now, I know the naysayers will chime in with the old rhyme that DH will only dilute this market and knock down the average fare. However, the lowest fare available at 11 weeks out is $169 according to flyi.com. The logic suggests that these fares will sell and SJU will be a profitable market.
Cheers.
Sep 30, 2005, 7:12 am
#17
Join Date: May 2001
Location: IAD
Posts: 6,148
Originally Posted by Cohiba
Now, I know the naysayers will chime in with the old rhyme that DH will only dilute this market and knock down the average fare. However, the lowest fare available at 11 weeks out is $169 according to flyi.com. The logic suggests that these fares will sell and SJU will be a profitable market.
The real question is how many $399 fares will be sold. jetBlue's highest fare JFK-SJU is $349...
Sep 30, 2005, 7:44 am
#18
Original Member, Moderator: Hotel Deals and MilesBuzz
Join Date: May 1998
Location: Washington, DC
Posts: 14,257
Im also one of the naysayers, I dont work for a competing airline and I live in the IAD market. I don't let airline loyalty, my own travel agenda or personal financial gain cloud my opinion of Independence Air. To me, it is strictly business.
It doesn't matter if DH has figured out what routes have robust RASM. The bottom line is they have a poor leadership and a defective business plan that leaves absolutely no room for errors and most likely, no room for financial recovery.
It doesn't matter if DH has figured out what routes have robust RASM. The bottom line is they have a poor leadership and a defective business plan that leaves absolutely no room for errors and most likely, no room for financial recovery.
Sep 30, 2005, 8:06 am
#19
Join Date: Nov 2002
Location: Chicago, IL USA
Posts: 862
Originally Posted by MileageAddict
It doesn't matter if DH has figured out what routes have robust RASM. The bottom line is they have a poor leadership and a defective business plan that leaves absolutely no room for errors and most likely, no room for financial recovery.
I get the feeling that the looked and BK options, and discovered that Ch. 11 wasn't a viable option. So, they decided to work as best they can to work out their own survival. Will they succeed? We will see. If they would have restructured a year ago and cut back their RJ service, and actually taken deliveries of the the Airbus jets, they may be teatering on the edge of profitability now. However, now it may take a near lawless execution to make it. (And they have to survive a couple of lean travel months before they make it to the holiday season.)
Sep 30, 2005, 9:56 am
#20
Join Date: Sep 2002
Location: NOVA
Programs: IHG Rewards Platinum, Marriott Gold, Hilton Diamond, UA/DL/AA Back of the plane...
Posts: 4,612
Originally Posted by oopsz
um, remember when panam and eastern both started caribbean service?
you betcha! airlines in desperation think cruise/vacation traffic is easy money. when will they learn?
you betcha! airlines in desperation think cruise/vacation traffic is easy money. when will they learn?
I may be wrong - but I thought that Pan Am and Eastern were in the central/south america and the caribbean LONG LONG LONG before they had problems (or evil leadership like Frank Lorenzo at EA) - These routes were the ones that were being SOLD at the end .....
Sep 30, 2005, 11:11 am
#21
Join Date: Aug 2004
Location: Fairfield County, CT
Programs: DL Gold Medallion
Posts: 213
Originally Posted by MileageAddict
Im also one of the naysayers, I dont work for a competing airline and I live in the IAD market. I don't let airline loyalty, my own travel agenda or personal financial gain cloud my opinion of Independence Air. To me, it is strictly business.
It doesn't matter if DH has figured out what routes have robust RASM. The bottom line is they have a poor leadership and a defective business plan that leaves absolutely no room for errors and most likely, no room for financial recovery.
It doesn't matter if DH has figured out what routes have robust RASM. The bottom line is they have a poor leadership and a defective business plan that leaves absolutely no room for errors and most likely, no room for financial recovery.
I don't think the point of this thread is to opine about the prospects of DH's business plans. Yet that seems to be all you ever care to contribute to the discussion.
If someone had asked the question of whether or not DH has a good business plan, good leadership, or a healthy financial outlook, I'm sure that the answers would be forthcoming. SO why do you keep banging that drum when no one else is playing along?
Sep 30, 2005, 7:38 pm
#22
Join Date: May 2002
Location: South Park
Posts: 362
Trying to get back on topic...
To answer a couple questions. Yes, an average fare of $200 is significantly profitable in this market, unless of course you have very high unit costs (not the case with the A319) and/or you don't get anyone on the planes. Others may disagree, but I am fairly certain the latter also will not happen.
Right, the $139 is a lower listed fare, but it has not been sold yet. Notice that AA has a lowest listed fare of $129 so in fact, DH is entering the market trying to push the price up. You can put some of those $139s out there if necessary and still keep the revenue high. DH does not necessarily need to sell many $399 fares. A bunch of $249 fares will do quite nicely, though of course $399 is better.
Cheers.
To answer a couple questions. Yes, an average fare of $200 is significantly profitable in this market, unless of course you have very high unit costs (not the case with the A319) and/or you don't get anyone on the planes. Others may disagree, but I am fairly certain the latter also will not happen.
Right, the $139 is a lower listed fare, but it has not been sold yet. Notice that AA has a lowest listed fare of $129 so in fact, DH is entering the market trying to push the price up. You can put some of those $139s out there if necessary and still keep the revenue high. DH does not necessarily need to sell many $399 fares. A bunch of $249 fares will do quite nicely, though of course $399 is better.
Cheers.
Oct 1, 2005, 8:11 am
#23
Join Date: Feb 2005
Location: London, Ontario
Posts: 5,210
Originally Posted by oopsz
um, remember when panam and eastern both started caribbean service?
you betcha! airlines in desperation think cruise/vacation traffic is easy money. when will they learn?
you betcha! airlines in desperation think cruise/vacation traffic is easy money. when will they learn?
Oct 2, 2005, 9:41 pm
#24
Join Date: Aug 2002
Location: WAS, FLL
Programs: AA, B6, CO, DL, FL, UA, US Gold (only took 10k miles), WN, Amtrak
Posts: 1,299
Originally Posted by DanJ
SJU is a popular cruise port with some large ships based there, and airfare there is pretty high. Probably a good move if they can keep themselves in business long enough.
Oct 3, 2005, 10:05 pm
#25
Join Date: May 2003
Location: RDU
Programs: TSA/INS/FBI Platinum (stopped last 12 of 13 int'l returns - the computer broke once)
Posts: 2,638
While more focused on the weekends, the SJU cruise traffic seems to be spread out more than just Saturday and Sunday. Saturday is definately a big day, which is probably why a few airlines do a variety of once a week to SJU on Saturday.
I'm not saying that's going to solve all the problems, but cruise traffic should be enough to get some number of passengers on the plane most Fr/Sa/Su/Mo based on the December cruise schedule for SJU.
I'm not saying that's going to solve all the problems, but cruise traffic should be enough to get some number of passengers on the plane most Fr/Sa/Su/Mo based on the December cruise schedule for SJU.
Oct 7, 2005, 7:50 am
#26
Suspended
Join Date: Jun 2005
Programs: Continental Gold Elite, United Premier Executive
Posts: 6,766
Originally Posted by mid
I doubt that they would undertake the effort required to start this service if they didn't at least think they had a good chance of making it work.
On a side note: I'm more than a little disturbed by the efforts of some posters to take every single bit of news regarding DH and add in "if they stay in business long enough."
I can't help but notice that most of these posts come from locations like Chicago, IL and from people who have some affiliation/allegiance to a competing airline. The majority of those posts have no informative value other than to bash DH.
I would hope that people would only post when they can ADD to a discussion rather than express their prejudices. I fly UA and I fly DH. I've never felt the need to go into the UA forum and deride their chances for survival on a continuous basis.
I'm not a fan of the thread-crappers here and I hope they consider their aims the next time they post.
On a side note: I'm more than a little disturbed by the efforts of some posters to take every single bit of news regarding DH and add in "if they stay in business long enough."
I can't help but notice that most of these posts come from locations like Chicago, IL and from people who have some affiliation/allegiance to a competing airline. The majority of those posts have no informative value other than to bash DH.
I would hope that people would only post when they can ADD to a discussion rather than express their prejudices. I fly UA and I fly DH. I've never felt the need to go into the UA forum and deride their chances for survival on a continuous basis.
I'm not a fan of the thread-crappers here and I hope they consider their aims the next time they post.