Flyi Files Chapter 11

[767jetz]

Link to article

Not an unexpected move. Flyi's timing couldn't have been worse, trying to go it alone in the most difficult industry environment we've ever seen.

From a personal perspective I hope UA capitalizes on the opportunity to capture as much market share as possible from the Washington area.

Hind sight being 20/20, looks like renegotiating their express contract with UA would have been better for ACA.

The saga continues...

 

[novaqt]

Yes it does 767jetz. I agree, this only proves that it takes much more planning to become a low cost carrier than to simply be angry at the legacy carrier who asked them to renegotiate their contract with them. Their decisionmakers have a huge amount of egg on their faces and bruised egos.

 

[avek00]

Link to article

Not an unexpected move. Flyi's timing couldn't have been worse, trying to go it alone in the most difficult industry environment we've ever seen.

From a personal perspective I hope UA capitalizes on the opportunity to capture as much market share as possible from the Washington area.

Hind sight being 20/20, looks like renegotiating their express contract with UA would have been better for ACA.

The saga continues...

UA benefitted from the Indy Air presence via an increase in incremental traffic peripheral to the hub's focus, and the airline doesn't need to expand to fill a nonexistent void.

 

[Fly]

I highly doubt that having FlyI in IAD was good for UAL. :down: I feel for the employees but am very glad to see them exiting the market around the same time UAL is emerging from BK. Great timing.

 

[avek00]

I highly doubt that having FlyI in IAD was good for UAL. :down: I feel for the employees but am very glad to see them exiting the market around the same time UAL is emerging from BK. Great timing.

The United Dulles hub witnessed an increase in shorthaul O&D and North-South domestic connecting traffic because of the traffic surges generated by Independence. Since UA IAD focuses primarily on feeding East Coast pax into the midcon/transcon/longhaul network (and vice versa), the O&D shorthaul and North-South connectors are basically revenue icing on the cake. Had DH's expansion to the West been successful, that would have posed a significant threat to United - the West Coast move was a failure, however, and thus United wound up with fuller planes and higher revenues from the Indy Air Freak Show.

 

[whlinder]

Is that your opinion or can you point us to some data that shows UA is better off with FlyI causing traffic surges?

 

[boeing787]

Bottom line on this one. INDY AIR was hurting not only UAL but every airline with $29 dollar seats everywhere. With them out of the picture, prices will go up to a much more to reasonable level and UAL will benefit the most. I would even expect a small expansion to add capacity from the demise of FLYi in IAD.

 

[Ch. 12]

The United Dulles hub witnessed an increase in shorthaul O&D and North-South domestic connecting traffic because of the traffic surges generated by Independence. Since UA IAD focuses primarily on feeding East Coast pax into the midcon/transcon/longhaul network (and vice versa), the O&D shorthaul and North-South connectors are basically revenue icing on the cake. Had DH's expansion to the West been successful, that would have posed a significant threat to United - the West Coast move was a failure, however, and thus United wound up with fuller planes and higher revenues from the Indy Air Freak Show.

You can create artificial demand anytime you charge fares as low as Indy has. Problem is...and contrary to your assertion...these were not profitable fares and were not the icing on the cake but rather the fly in the soup. Sure they added something but it wasn't desireable. Let the people that won't pay more than $20 each way go back to driving. This industry cannot sustain by catering to that population. I could see it now...a subway in the sky where $1.25 will get you a o/w and you can get a transfer for an extra 75 cents.

 

[FWAAA]

If I understand avek correctly, he's trying to equate FlyI's ridiculously low fares with the "Southwest Effect." When WN moves into a city, it often causes local O&D traffic to grow - sometimes by huge percentages. While that sometimes kills the overpriced legacies in that city, it sometimes actually helps the legacies if they are willing to adapt.

But FlyI's fares didn't stimulate traffic by any appreciable percentage. Most of their 50 seat RJ flights went out about 40% full and even their A319s went out about 60% full (over the entire time the A319s were on the property). On top of that, they had very little capacity compared to WN moving to town. They spread their very few flights over a large number of cities.

FlyI can't take credit for any real demand stimulation. UAL will fare better without FlyI. So will every other airline operating in the same markets.

 

[WorldTraveler]

However, IAD is not likely to be without a discount carrier for long - even if Indy folds. There is a market for low fares and UA certainly won't price at Indy fares w/ Indy gone. Other carriers have much lower costs and will go after the market. IAD is one of the very few markets in the NE that has growth potential and excess capacity.

 

[magsau]

However, IAD is not likely to be without a discount carrier for long - even if Indy folds. There is a market for low fares and UA certainly won't price at Indy fares w/ Indy gone. Other carriers have much lower costs and will go after the market. IAD is one of the very few markets in the NE that has growth potential and excess capacity.

World,

For a name like world it would appear you never get out of the ATL. There is not excess capacity at IAD in term s of ATC. The controllers at IAD are among the worst in the country and they have the airport saturated in its current state with flyi only offering 100 or so flights. With the flyi reduction that may put the airport back in line with the skills of the controllers.

As for IAD being a hotbed for LCC's you must have forgotten that in the past couple of years UAL has chased away Song, Metrojet and now flyi. So you tell me again how much the local area is embracing the LCC concept. UAL has a good market share at IAD and the hub performs well for its size.

The information is out there World all you have to do is look for it and understand it.

 

[jbguppy]

However, IAD is not likely to be without a discount carrier for long - even if Indy folds. There is a market for low fares and UA certainly won't price at Indy fares w/ Indy gone. Other carriers have much lower costs and will go after the market. IAD is one of the very few markets in the NE that has growth potential and excess capacity.

Please elaborate on the carriers out there with lower costs.....

Looking forward to your analysis, and numbers that you can source.

JBG

 

[whlinder]

Don't forget ValuJet used to have a sizable operation at IAD, I believe it was their #2 station back in the day.

Still though, UA needs to be mindful that B6 has all those planes coming in the next couple of years. It isn't hard to envision a larger B6 operation at IAD once FlyI is laid to rest.

 

[nostradamus]

While you are licking your chops over a hurt target, do not forget that you are being eyed as a hurting target.

 

[avek00]

Bottom line on this one. INDY AIR was hurting not only UAL but every airline with $29 dollar seats everywhere. With them out of the picture, prices will go up to a much more to reasonable level and UAL will benefit the most. I would even expect a small expansion to add capacity from the demise of FLYi in IAD.

US Airways likely experienced far more damage from Independence Air than United, because US DOES go after the same pax (namely, short/medium-haul O&D) as Indy in the Washington market. To the extent that DH created a Southwest effect in the cities it served (and it did do so in IAD and some smaller East Coast markets), United benefitted from carrying the incremental O&D traffic that it otherwise does not cater to with its hub operation.