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Post COVID-19 -- What long haul competitive moves should UA make?

Post COVID-19 -- What long haul competitive moves should UA make?

Old Apr 19, 20, 2:02 pm
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Post COVID-19 -- What long haul competitive moves should UA make?

Once demand starts to return, I could see the strong sucking the oxygen out of the air to crush the weak -- especially UA given they have so many idle long-range birds.

1. EWR-CPT/JNB (hurting SA)
2. SFO-DEL to 2x/day (hurting AI)
3. EWR-BOM to 2x/day (hurting AI)
4. SFO-HKG to 2x/day already done (hurting SQ and CX)
5. LAX-CDG (hurting Norwegian)
6. LAX-HKG (hurting CX)

Last edited by WineCountryUA; Apr 19, 20 at 7:20 pm Reason: created new thread
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Old Apr 19, 20, 4:45 pm
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Originally Posted by spartacusmcfly View Post
Once demand starts to return, I could see the strong sucking the oxygen out of the air to crush the weak
You continue to propose patently illegal things. UA is simply not allowed to sit around and think "gosh, let's crush our competition."

Originally Posted by spartacusmcfly View Post
1. EWR-CPT/JNB (hurting SA)
One or the other, possibly. Both, absolutely not. There's just not enough demand.

Originally Posted by spartacusmcfly View Post
2. SFO-DEL to 2x/day (hurting AI)
UA is more likely to cancel the one SFO-DEL flight than to run two.

Originally Posted by spartacusmcfly View Post
3. EWR-BOM to 2x/day (hurting AI)
Maybe; EWR-BOM has been a lucrative route going back years. I'm not sure there's enough demand to fill two frequencies, but maybe if they're both 789s. Competing against the ME3 will remain a challenge for departures from cities other than New York, though.

Originally Posted by spartacusmcfly View Post
4. SFO-HKG to 2x/day already done (hurting SQ and CX)
Already backed off of, likely for at least a year, if not longer. I'd expect ORD-HKG to come back before the second SFO-HKG frequency.

Originally Posted by spartacusmcfly View Post
5. LAX-CDG (hurting Norwegian)
Less than zero chance that UA decides to try to build service in a market that is hub-hub for SkyTeam (AF/DL).

Originally Posted by spartacusmcfly View Post
6. LAX-HKG (hurting CX)
Possibly even less chance than CDG. LAX-HKG has been a bloodbath for years. Nobody is making any money on it.
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Old Apr 19, 20, 5:11 pm
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Originally Posted by jsloan View Post
You continue to propose patently illegal things. UA is simply not allowed to sit around and think "gosh, let's crush our competition."
I don't recall UA changing their status to non-profit...they absolutely do think about and try to hurt competitors.

No collusion or gamesmanship. Simply one company thinking their product will be better received than a competitor's.

BTW, now that UA just sold many of its long-range aircraft to the Chinese, in exchange for long-term lease-backs, they will get very aggressive in putting these birds in the sky...

I'd be shaking in my boots if I was Norwegian, Air India, or SQ...
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Old Apr 19, 20, 5:17 pm
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Originally Posted by jsloan View Post
One or the other, possibly. Both, absolutely not. There's just not enough demand.
Maybe UA could run CPT-JNB as a tag onto the flight? Don't think they can manage EWR-JNB because of hot/high nature of taking off from JNB, even on a 789.
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Old Apr 19, 20, 5:38 pm
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Originally Posted by spartacusmcfly View Post
I don't recall UA changing their status to non-profit...they absolutely do think about and try to hurt competitors.
The actions you describe are illegal. Anti-trust regulators (and attorneys) have their ears perk up at any statement about "hurting" the competition.

Originally Posted by spartacusmcfly View Post
No collusion or gamesmanship. Simply one company thinking their product will be better received than a competitor's.
Thinking your product will be better received is not illegal. Entering a market not because it is profitable, but because it will hurt your competition, is illegal.

Originally Posted by spartacusmcfly View Post
BTW, now that UA just sold many of its long-range aircraft to the Chinese, in exchange for long-term lease-backs, they will get very aggressive in putting these birds in the sky...
I don't know why I bother, but.. that makes no sense. UA sold the aircraft to the Chinese because they're in dire financial straits. They didn't do it as part of some plan to get more aggressive using those planes. They'd use them, encumbered by leases or not.

Originally Posted by spartacusmcfly View Post
I'd be shaking in my boots if I was Norwegian, Air India, or SQ...
Norwegian and AI have a host of problems, but UA isn't a big enough one for them to notice. As for SQ, they get consistently better marks for customer satisfaction, operate out of one of the nicest airports in the world, and are backed by a government who sees them as an extension of their chamber of commerce. SQ's problem is that domestic air travel is likely to pick back up before international air travel does, and, well... not a lot of domestic lift for them. SQ's problem is not UA. You're basically arguing that Porsche should be worried that Chevrolet is building a new car.

Originally Posted by PsiFighter37 View Post
Maybe UA could run CPT-JNB as a tag onto the flight? Don't think they can manage EWR-JNB because of hot/high nature of taking off from JNB, even on a 789.
Or a tech stop at ACC or LOS or something. I agree; I'm not sure they can do JNB-EWR nonstop. A triangle route EWR-JNB-CPT-EWR might work.
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Old Apr 19, 20, 5:39 pm
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Originally Posted by PsiFighter37 View Post
Maybe UA could run CPT-JNB as a tag onto the flight?
Yes, I believe UA used to do something like this with Sao Paulo & Rio.
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Old Apr 19, 20, 6:10 pm
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Originally Posted by jsloan View Post
One or the other, possibly. Both, absolutely not. There's just not enough demand.
With SA JFK-JNB and IAD-ACC-JNB gone, there will certainly be demand, at least once there's a vaccine.
Triangle route could certainly make sense.
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Old Apr 19, 20, 6:30 pm
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Originally Posted by jsloan View Post
Thinking your product will be better received is not illegal. Entering a market not because it is profitable, but because it will hurt your competition, is illegal.
Please don't make things up. No one is suggesting UA lose money. EWR-CPT was already profitable and now that SA is liquidating, profitability gets even better...

Originally Posted by jsloan View Post
As for SQ, they get consistently better marks for customer satisfaction...
Sounds like an SQ marketing brochure... Unfortunately, the reality is SQ passenger traffic has been flat for nearly a decade as has profitability. The days of SQ shuttling Chinese and Indians around the world are over as those countries are excelling in the AIrline industry. Singapore is the size and population of a NY borough, so there is no domestic market. Singaporeans are smart and have no desire to backstop future losses. Putting a little pressure on some of their 5th freedom routes like SFO-HKG should see them exit quickly. Anyway, there's no reason to debate this. UA has done exactly this by launching SFO-HKG #2 . This is an evening flight that goes toe-to-toe with SQ's evening flight. So let's see if it works!

Last edited by spartacusmcfly; Apr 19, 20 at 6:35 pm
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Old Apr 19, 20, 7:38 pm
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IMHO, post-COVID-19 US carriers will change their tune on the ME3 and pursue adding them to existing trans-Atlantic joint ventures. AA had made its intentions clear by announcing SEA-DOH and strongly indicating other USA-DOH AA flights will later follow. UA needs to beat DL to the punch by bringing Emirates into the fold. UA, for its part, could run EWR-DXB, SFO-DXB, ORD-DXB, and IAD-DXB flights to support such a move.
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Old Apr 19, 20, 7:39 pm
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I think that whenever international flights resume in earnest, SFO will be least impacted / have the least number of routes cut. I wonder how UA will approach their East Coast TATL strategy with EWR and IAD - EWR is the primary hub, but I also know UA has no interest in using EWR for connecting traffic (although that may not be an issue with loads whenever the 'new normal' sets in).
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Old Apr 19, 20, 7:42 pm
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Originally Posted by spartacusmcfly View Post
Please don't make things up. No one is suggesting UA lose money. EWR-CPT was already profitable and now that SA is liquidating, profitability gets even better...
If anyone at UA is talking about "hurting their competition," they are breaking the law. And if they are trying to push the competition into bankruptcy in order to make a route more profitable, they are breaking the law. And if you don't think that the DOJ cares, you may be right -- but all of these are international routes, and I promise you that there are other regulators who will care. If you want to discuss route expansions, that's fine. But they need to stand on their own. (Incidentally, neither of us have any idea whether or not EWR-CPT was profitable, or if it would be profitable again if it were to be restored).

Originally Posted by spartacusmcfly View Post
Sounds like an SQ marketing brochure... Unfortunately, the reality is SQ passenger traffic has been flat for nearly a decade as has profitability.
During / after the 2008-9 financial crisis, SQ was told to go make some money, so they cut a bunch of their less profitable routes and retired their less efficient planes. They've been building their traffic back, and it's basically rebounded to where it was, but they've managed to cut costs. That said, when push comes to shove, the government will support them.

Originally Posted by spartacusmcfly View Post
Singapore is the size and population of a NY borough, so there is no domestic market.
Did you honestly think I didn't know that?

Originally Posted by spartacusmcfly View Post
Singaporeans are smart and have no desire to backstop future losses.
The government owns SQ, and it is absolutely part of their plan for positioning Singapore as a global business leader. Their business model is completely different than UA's.

Originally Posted by spartacusmcfly View Post
Putting a little pressure on some of their 5th freedom routes like SFO-HKG should see them exit quickly. Anyway, there's no reason to debate this. UA has done exactly this by launching SFO-HKG #2 . This is an evening flight that goes toe-to-toe with SQ's evening flight. So let's see if it works!
UA has already dropped that flight. And, if it would "put pressure" on SQ, that doesn't sound like a huge profit opportunity. Few people are selecting UA for their product. Even fewer are selecting UA for their service. So, they're presumably looking to compete on price. That... doesn't sound like a decision you'd make unless you were trying to do one of those illegal things mentioned above.

Demand to HKG was already in the toilet due to the civil unrest. Throw in a pandemic, and nobody's going to be looking to bring service back any time soon. The second SFO-HKG flight likely won't operate until 2021 at the earliest. As I said, I think they'd bring back ORD-HKG first.

Overall, you still seem to be approaching this from the same position you had before, when you wanted UA to buy AI -- that UA was a "strong company' (your words) that should be able to take advantage of an opportunity.

Every indication is that UA is not a strong company, but rather an extremely weak company. They are mortgaging their assets and borrowing to make payroll. Yes, they need passenger traffic, absolutely -- but they are not going to be in any position to do some massive expansion. They're going to stick to rebuilding their own portfolio, not wondering what international competition is doing.
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Old Apr 19, 20, 7:43 pm
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Originally Posted by nerdbirdsjc View Post
IMHO, post-COVID-19 US carriers will change their tune on the ME3 and pursue adding them to existing trans-Atlantic joint ventures. AA had made its intentions clear by announcing SEA-DOH and strongly indicating other USA-DOH AA flights will later follow. UA needs to beat DL to the punch by bringing Emirates into the fold. UA, for its part, could run EWR-DXB, SFO-DXB, ORD-DXB, and IAD-DXB flights to support such a move.
Lufthansa may have an issue with that. I'm not sure, but I believe Lufthansa does well shuttling folks from the US to Southern Asia and the Middle East. I think all that volume would shift to ME3 if they joined the JV.
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Old Apr 19, 20, 7:54 pm
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Originally Posted by spartacusmcfly View Post
Lufthansa may have an issue with that. I'm not sure, but I believe Lufthansa does well shuttling folks from the US to Southern Asia and the Middle East. I think all that volume would shift to ME3 if they joined the JV.
Agreed. The ME3 have been a collective thorn in a lot of sides. AA's decision to partner with QR wasn't without controversy, both within and without Oneworld.
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Old Apr 19, 20, 10:06 pm
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Don't these type of threads find more of an audience on Airliners.net? UA will be lucky to survive and there will be little demand for any of these services mentioned above for the next 18-24 months. UA, unfortunately, will not be able to mimic Arnold and "crush their enemies, see them driven before them and hear the lamentations of their women."
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Old Apr 19, 20, 10:35 pm
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Originally Posted by travelinmanS View Post
Don't these type of threads find more of an audience on Airliners.net? UA will be lucky to survive and there will be little demand for any of these services mentioned above for the next 18-24 months. UA, unfortunately, will not be able to mimic Arnold and "crush their enemies, see them driven before them and hear the lamentations of their women."
You're probably right. There will be no demand for air travel from any of the major cities above for the next two years...
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