US-Mexico ready to expand bilateral, opportunities

[eolesen]

Did you ever think that the others don't need an international carrier?

 

[WorldTraveler]

of course they don't.... and the size of the benefit will be proportionately smaller.

 

[eolesen]

Benefits are measured differently based on the eye of the beholder...

There's a pretty good argument that taking two networks without overlaps is the best type of partnership you can strike. By that measure, anyone linking up with Interjet, and to a lesser degree Volaris or VivaAerobus, has a pretty good chance of seeing immediate benefits without cannibalizing their or their partner's flights.

 

[MAH4546]

uh, you THINK there is money from MIA and Texas to Latin America.

WN and B6 are just getting warmed up.

the new US-Mexico bilateral goes into effect in about 45 days. You can bet new route announcements will come out in spades over the next few months.

 
I don't "think" anything.
 
Texas and Miami are the most profitable Mexico flying.
 
Firstly, it's the two places with the strongest business connections to Mexico. From most large U.S. cities, including LAX, SF and CHI, the largest market to Mexico is actually Guadalajara, not Mexico City, 
 
Secondly, the stage length is relatively short.
 
MIA/IAH/DFWMEX fares are higher than anything from California or Illinois at much shorter stage lengths. 

 

[WorldTraveler]

again, what those markets are NOW is immaterial to what will be the case in a couple years.

everyone knows where the money is NOW.

that is why capacity will flood into the US-Latin America market. Azul is adding longhaul int'l flying and Avianca Brasil says they will do the same.... and that is just one market.
from the US, WN is staking its future on Latin America - and developing gateways from Texas and S. Florida - along with B6.

it doesn't take a Ph.D. to figure out where this will all end up, esp. for AA which has dominated the US-Latin America market and will have to develop the Mexico market with a partner that is far less strong than AeroMexico.

 

[eolesen]

AA may dominate US-Latin as a region, but we're talking about Mexico. There are other carriers who have a decent presence in that market, and are pretty well positioned to improve their position.

NK's already made the first move, and I really don't see WN or UA sitting back from Texas or California. And with all the other irons in the fire, DL's suddenly supposed to become the uber-dominant player?...

I know, they'll leverage their JV partner's metal. Last time I checked, AM ain't up to the same standards as even Spirit, but maybe things have changed since DL took their not-quite-controlling stake. Oh, that's right, they have a seat on the board, too...

 

[WorldTraveler]

no one said that DL would become uber dominant.

DL does have the strongest strategic partner and has little risk to its own Mexico markets or other Latin markets compared to AA or UA

All of the bravado about how great AA and UA's hubs have been for local traffic will end up with the same result as exists at ORD and other markets that were deregulated a long time ago... competition flocks to the largest markets because they have the best chance of pushing their way into the market.

AA and UA Have lost more market share and lost more pricing power to LCCs over the past 35 years than DL has - precisely because DL builds its hubs around medium sized markets that it can dominate while AA and UA's networks are built around the largest cities in the US.

and DL has equity positions in both AM and G3, something no other US carrier has... and DL has absolutely succeeded in pushing more traffic onto DLs network while also improving the profitability of those carriers.


again, let's see how it all plays out but I can say with certainty that DL will gain more from its relationship with AM and G3 than AA has with JL in the Pacific, regions where each carrier needed more strength.

 

[eolesen]

Nice deflection...

You're like one of those pull-string dolls from days gone -- pull the string, and it repeats the same three or four different phrases over and over and over...

"DL's done better at defending its hubs from ULCC's"

"DL's got the most successful JV's"

"DL does better in the Pacific than anyone else"

 

[WorldTraveler]

and what frosts your chaps is that it is true.

and when the US-Mexico market is deregulated and the growth of carriers in Latin America has taken place, it will be all the more clear that DL has found opportunities to grow its network while AA will be most impacted by low fare competition - exactly what I have said would take place for years.

chapter 2 is taking place now with new growth by Azul, following growth by JetBlue and Spirit in chapter 1, with a whole lot more to come in chapters 3 and beyond.

 

[Kev3188]

Nice deflection...

You're like one of those pull-string dolls from days gone -- pull the string, and it repeats the same three or four different phrases over and over and over...

"DL's done better at defending its hubs from ULCC's"

"DL's got the most successful JV's"

"DL does better in the Pacific than anyone else"

Speaking of cowboys, don't forget "the domination of N. Texas."

 

[WorldTraveler]

since you mentioned it, DL's chances of being profitable in the Texas-LAX markets are a whole lot higher than for AA to do the same from ATL to LAX.

 

[FrugalFlyerv2.0]

This is going to sound ignorant because I don't know too much about Mexico, but I gotta ask:  what's the big deal about Mexico?
 
The way I see it, despite the 100+ million population, most Mexicans would rather swim across the Rio Grande than fly on an airliner for their travel to the USA.  As far a business, I could only see service to MEX as a highly sought-after destination, whereas destinations such as CUN, ACA are good places to burn FF miles to.
Basically, what am I missing here?  Why is it that important to 'win' in Mexico?

 

[topDawg]

since you mentioned it, DL's chances of being profitable in the Texas-LAX markets are a whole lot higher than for AA to do the same from ATL to LAX.

Lol thats funny. 
 
Delta has a better chance of being profitable in a market that has 6 carriers in it than one that has 2? 

 

[WorldTraveler]

This is going to sound ignorant because I don't know too much about Mexico, but I gotta ask:  what's the big deal about Mexico?
 
The way I see it, despite the 100+ million population, most Mexicans would rather swim across the Rio Grande than fly on an airliner for their travel to the USA.  As far a business, I could only see service to MEX as a highly sought-after destination, whereas destinations such as CUN, ACA are good places to burn FF miles to.
Basically, what am I missing here?  Why is it that important to 'win' in Mexico?

 
what an incredibly ignorant, biased, and racist statement.

Mexico is the largest air travel market for US carriers already.


it is set to get a whole lot larger due to liberalization of the market because of this agreement and because of the growth of low fare carriers.

to try to reduce the economic potential of the market to racist comments is not only disgusting but typical of the market ignorance that is so common for so many on this board.

 

Lol thats funny. 
 
Delta has a better chance of being profitable in a market that has 6 carriers in it than one that has 2?

no, that is what is ignorant.

there are 6 plus carriers in many global markets. there are 3 US megacarriers and 3 of the same in Europe. most countries have 2 or more direct carriers.

Mexico has ONE int'l carrier. DL happens to have an exclusive relationship with it.

DL's investment in AM is about ready to move to a whole new level to DL's benefit and the detriment of other carriers.

 

[Kev3188]

what an incredibly ignorant, biased, and racist statement.

Oh please. Tell us more about how asking an honest question is racist.

No wait...don't...