US cuts traffic to LAS, why?
Dec 9, 2007, 8:19 am
#1
Original Poster
Join Date: Dec 2002
Location: PHX
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US cuts traffic to LAS, why?
According to this source:
http://www.lvrj.com/business/11992981.html
October traffic to LAS was down over 200,000 but, this article mentioned that LAS was expected to be expanded this year:
http://www.post-gazette.com/pg/07137/786717-28.stm
Anyone know why the traffic is down so sharply?
http://www.lvrj.com/business/11992981.html
October traffic to LAS was down over 200,000 but, this article mentioned that LAS was expected to be expanded this year:
http://www.post-gazette.com/pg/07137/786717-28.stm
Anyone know why the traffic is down so sharply?
Dec 9, 2007, 9:45 am
#2
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But, they are "experienced with competing with LUV." How could this be?
Dec 9, 2007, 10:10 am
#3
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Dec 9, 2007, 10:17 am
#4
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Too much competition. I believe it is a repeated pattern of running away from competition, seeking to operate only where they can charge high fares (not many transcons flights left, are there, despite high load factors). Shrinking their way to profitability through niche market operations.
I believe that strategy, that drove short-term profitability, will be their long-term demise. Along with focusing on high demand elasticity leisure travel that will crush them in a downturn.
I believe that strategy, that drove short-term profitability, will be their long-term demise. Along with focusing on high demand elasticity leisure travel that will crush them in a downturn.
Dec 9, 2007, 5:14 pm
#5
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WN is taking delivery of 37 new 737s this year and until the other day, planned to take delivery of 30 next year. And 2004-06 saw hefty fleet gains at WN also. That's a lot of seats, and WN is pretty competent at filling its new capacity with money-making fares (unlike some of its LCC competitiors). No wonder it's offering lots more seats to LAS (and filling them).
Hasn't US been returning aircraft over the past couple of years?
Hasn't US been returning aircraft over the past couple of years?
Dec 9, 2007, 7:31 pm
#6
Join Date: May 2006
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I think that the flights into and out of LAS were always marginally profitable, if at all. They were profitable based on increased utilization for the aircraft and things like that. They were never gold mines. They were probably only marginally profitable with $50-$60 a barrel oil....now with $90 a barrel oil, I am sure a lot of them have swung from break even/marginally profitable to unprofitable. And we all know about US/HP and flying unprofitable routes.....not gonna happen!
Dec 9, 2007, 9:52 pm
#7
Join Date: May 2007
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I think that the flights into and out of LAS were always marginally profitable, if at all. They were profitable based on increased utilization for the aircraft and things like that. They were never gold mines. They were probably only marginally profitable with $50-$60 a barrel oil....now with $90 a barrel oil, I am sure a lot of them have swung from break even/marginally profitable to unprofitable. And we all know about US/HP and flying unprofitable routes.....not gonna happen!
Thanks.
Dec 10, 2007, 6:22 am
#8
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Isn't LAS a mini-hub? They're probably doing the same thing thing to LAS that they did to PIT. De-hub it, since it's not far from PHX they figure they can do like on the east coast...force everyone through PHX the same as they forced everyone through PHL.
Typical - WN makes money avoiding the hub and spoke system, and Tempe narrows their offerings even further through they already-clogged hub system.
Typical - WN makes money avoiding the hub and spoke system, and Tempe narrows their offerings even further through they already-clogged hub system.
Dec 10, 2007, 7:42 am
#9
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Even though it has a high proportion of leisure travelers, its the #1 or #2 O&D airport in the US, so there is definitely money to be made there. I'm betting its unprofitable for US.
Dec 10, 2007, 8:10 am
#10
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They definitely cut LAS-DEN. HP used to have 5-6 flights a day, and now they are just codesharing UA or connecting through PHX.
Dec 10, 2007, 8:55 am
#11
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I also wonder about the effect of G4 - for example the US price for LAS-EUG is around $500 while G4 has flights under $140.
Dec 10, 2007, 8:55 pm
#12
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Another reason that I transfered from CP -> US 0. My new BD status was 90% earned by flying UA.
Dec 11, 2007, 6:55 am
#13
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For a while prices on US to Vegas seemed to skyrocket. I wonder if they thought "we'll reduce capacity and be able to charge more" and that just didn't work. For example, for the past 6 months or more, except for rare occasions, BOS to LAS (a route NOT served by WN except through MHT or PVD), seemed to always be well over $400 and often more than $450 non-stop. Now that route is selling for $300.
Also, any trip out west with a connection in LAS seems to be the cheapest available. I think they tried to assert some pricing control, found WN wouldn't go along with them (though JetBlue and other did) and got knocked to the mat.
I think they need to market those routes better - that's where WN kills them. They should bring back special promotions such as Vegas stopover vacations. I've always heard those were successful.
Also, any trip out west with a connection in LAS seems to be the cheapest available. I think they tried to assert some pricing control, found WN wouldn't go along with them (though JetBlue and other did) and got knocked to the mat.
I think they need to market those routes better - that's where WN kills them. They should bring back special promotions such as Vegas stopover vacations. I've always heard those were successful.
Dec 11, 2007, 2:49 pm
#14
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US has to figure out what it wants to do with LAS.
The HP "night flight" banks were a great idea. Why?
1. Add aircraft utilization.
2. WN does not do redeyes--no competition at those hours, thus allowing for some small degree of pricing control.
The problem becomes that people might not want to only show up or depart Vegas at night. Which makes US fly there during the day. When they obviously get killed or consider it unprofitable, as they reduce the number of seats they will put in the market--they cannot effectively compete with WN during the day.
The HP "night flight" banks were a great idea. Why?
1. Add aircraft utilization.
2. WN does not do redeyes--no competition at those hours, thus allowing for some small degree of pricing control.
The problem becomes that people might not want to only show up or depart Vegas at night. Which makes US fly there during the day. When they obviously get killed or consider it unprofitable, as they reduce the number of seats they will put in the market--they cannot effectively compete with WN during the day.