Beckles

Seems like some of the legacies are giving up trying to fight WN and ceding markets to WN. Just today it came out that UA is closing shop in FLL and PBI and AA is closing shop in ALB and PVD. While these changes aren't huge, they can not be seen as anything but a good thing for WN which serves these airports and continues to expand service.

I don't see how the legacies think they can shrink to profitability, especially as they continue to make decisions that only make their strongest competitor more successful.

formeraa

I'm not sure that ELIMINATING competition ever is good for the consumer.

MileageAddict

I consider Southwest to be a legacy carrier now.

FCfree

Legacy by age, but not by spirit.

For the true legacy carriers (UA, AA), I think that they are flying some losing routes, so dropping them might just be their answer. But, the more you shrink, the less reason there is for somebody to stay loyal.

I'm still amazed at the opportunity the true legacy carriers have given Southwest by adding one junk fee after the other. It plays right into Southwest's strategy.

Beckles

Nope, it's not ... but these changes are good for us WN shareholders.

ssk1127

Legacy airlines are focusing on the higher-paying business segment of the market and ceding the lower-yield leisure market to WN and the other LCCs. MIA has a larger business clientele than FLL, BOS more than PVD, SFO more than OAK, etc. Similarly, DL is cutting MCO service and US is scaling back LAS.

It's a strategy shift; remains to be seen if it will work or not, but it's not necessarily a good thing for WN if they get squeezed out of the higher-paying segment of the market. They're trying to compete for that market as well, hence Business Select and PHL/DEN/SFO service. Time will tell how it all shakes out.

nsx

Legacies don't realize that they don't have enough F seats for their business customers, and that the legacy coach product (except UA's E+) are inferior to Southwest's. As soon as customers try Southwest and discover this, which they will do one by one, the legacies' ostrich game is over. Just my opinion.

pitflyer

To be fair nsx, first class seats are only one of the perks (and after being top tier USAirways for several years back in the 'good old days', not even then a great perk). Awards for exotic international destinations, awards on partner airlines, and 'the network' (ie smaller cities Southwest cant afford to serve) are still legacy advantages. And a lot of people consider assigned seats a big advantage, whether or not us Southwest regulars agree.

I may be a typical convert to Southwest -- they are great for my regular trips to Las Vegas (paid and award) but I still maintain a large balance at American and other legacies -- I have business class tickets on Lufthansa to Rome courtesy of USAirways, and I can impress my mom with my frequent flier status much more than sitting in the nose of a 747 every couple of years vs earning awards to Las Vegas over and over again

For Beckles original point, I think a lot of people have said that Southwest cherry picked routes, and to certain extent they still do. I think the legacies are learning to cherry pick too, and there is definitely some retreat from fighting losing battles with Southwest.

nsx

The assigned seat advantage will mostly disappear after people learn Southwest's assigned boarding system. As to the other advantage, free international travel, the legacies are destroying that all by themselves. It's quite stupid of them, but the legacies are slowly but surely convincing most of their high-fare business customers that saving miles for international trips is a chump's game. Award inflation, draconian capacity controls, and now bogus fuel fees charged on award redemptions combine to make the FF mile hobby downright depressing.

FTers are a resourceful lot, yet even we are beginning to throw in the towel on legacy FF programs. Ordinary customers will give up much more easily.

Once a customer gives up on the legacies' FF programs, he is easy for Southwest to win over. Southwest underpromises and overdelivers, rather than the reverse.

FCfree

I've got a good United balance, but every time I try to use the miles, I find either no availability or they want double-the-miles. In 2001, I used UA miles to go to Europe in Business Class. It was nice, but even with a big UA balance, at best I might get back there one more time because I'll probably have to give the standard award miles, not the saver award miles. And, Austrailia? Can't find hardly any tickets unless I give up 220,000 miles. At that price, I can go, but the family can't -- and that is not going to happen!

The free unlimited upgrade to first class perk on Northwest was great in 2001. From what I hear, NW GOLD still gets upgrades virtually all the time, but NW is cutting back and flying more RJ's that don't have a first class cabin. And who knows what that is going to look like after the NW-DL merger.

It seems to me that for years the legacies have been saying that they are giving up the low value tourists for the high value business travelers. In a boom time, the legacies make high profits, but in a lean time (like now) they hurt much worse than Southwest. By having a product that caters to everyone, Southwest has a more stable revenue and profit stream. Southwest turned that stable profit stream into their ability to play in the futures market, which hedged their fuel costs, which in turn make them more profitable. By not gouging the flying public, they had a more sound business model.

Going after the high value business travelers sounds so good in theory, but after 35+ years of the "Southwest Experiment", it just doesn't seem to work in practice.

On short hops, what you give Southwest and what you get in return (quality of service and FF perks and awards) just seems better than the value proposition on the legacy carriers.

nsx

FCfree, you illustrated my point for me: The legacies had a winning formula to hold onto high fare customers: ample upgrades and attainable international free flights. They are more than halfway to trashing that formula, and Southwest will absolutely clean their clocks for making such a blunder.

Khabibul35

Have you checked the summer schedule on WN? Yes, it's summer already, but even 2 months ago it was pretty bad. Maybe it's because I fly cross country but UA has a lot more open seats on my routes than WN.

This seems to constantly happen to me. I change from DL to AS because of terrible award availability then I change AS to WN and WN makes it hard to use awards. Maybe this isn't a game worth playing, just go for cheapest fare every time would be better (and WN loses that, although I gotta say the lack of fees make me pick WN when it's within $30).

Beckles

Sorry, but the legacies have no ability to "squeeze out" WN from any segment of the market by cutting capacity and destinations and raising fees and charges. Those things do nothing to damage WN's current position (low cost and high yield) and will certainly drive some flyers to WN, for which WN can and will name their price.

nsx

Summer award availability on WN is tight, no question about it. But I was referring to international award availability on legacies. That has been really, really bad. I used to be able to get summer seats to Europe with reasonable advance planning. It's now essentially impossible with inflexible city pairs and nearly infinite date flexibility. The legacies aren't delivering the free travel that the program member expected.

pitflyer

Hmm. I've heard a lot about international award availability being bad, but it wasn't terrible - or at least comparatively so. I was able to find flights on partner airlines using the Star Alliance, just had to use an alternate airport, and I saw plenty of flights available to Asia on OneWorld. Yes, the fees, etc, are getting pretty ridiculous compared to what they used to be, but since flying business on an European or Asian carrier is actually still enjoyable... I don't mind TOO much. And as posted, Southwest award availability can be really, really bad. It used to be I looked at the calendar and there were flights available almost every day, even if it was a bad connection, etc. Now I can easily see two weeks without any flights available on Southwest on popular routes like Vegas, etc.

I think the rumors of the death of the legacy carriers are exaggerated, except of course for USAirways which continues to find ways to shoot itself in the foot.