Jim,
perhaps you are trying to throw a loaded hand grenade with your statement but your statement is not only rather simplistic but it isn't entirely accurate.
WN's profits today stem from the fact that it still maintains a cost advantage over the legacy carriers - although a smaller one than at perhaps any time in its history - which is related to not having the legacy costs that other carriers had to shed in BK, and largely but not entirely succeeded at doing. It is simply an industry reality that every carrier that came after or substantially grew after deregulation had an advantage over the legacy carriers until all of the existing legacy carriers went into BK post 9/11 and emerged. Remember that prior to 9/11, the chances of survival after BK were slim while there was a 100% "cure rate" post 9/11.
Further, WN and other LCCs enjoy a cost advantage because of their younger workforces and the fact that they have been able to grow on a continuous basis which helps to keep costs down. It is no surprise that DL has been growing ever since it emerged from BK, US did the same, and new AA is off in the same direction. UA, because it cannot generate the revenues necessary to support a growing network have stopped growing.
VX has also pulled back its growth.
WN is not growing - in large part because they have no aircraft this year to do so.
Airlines that do not grow on a sustained basis will have costs grow at a faster rate; airlines that can grow will be able to keep their cost growth down - likely at or below the natural inflation rate.
WN also has done an outstanding job of finding markets where it can exploit its low costs to dominate markets. That is precisely what they have done in virtually every market until 9/11. It was only after 9/11 that they entered DEN, a highly competitive market, then PHL and ATL, and in neither case did they achieve anywhere close to the same success that they have had in other markets.
look at average fare data for many of their north-south west coast routes and they not only dominate them but the fares they get are not cheap; they rival what the legacy carriers get in heavily concentrated east coast markets.
When you or others talk about WN's sustained profits, you must acknowledge that they didn't have the legacy that other carriers have had and haven't had to get rid of.
It is far more appropriate to look at how well the industry does as a group now that the legacy carriers have had the chance to restructure their business plans post BK and figure out how to successfully compete with the LFCs.
The simple reality is that the strongest airlines in the world have succeeded by dominating their markets. DL and US did it post BK; AA's DFW and MIA hubs were well known to be their most profitable. UA, in contrast, has much less domination of its markets and that is part of the reason why they are not able to reap the rewards of consolidation in the industry.
Further, WN's network is significantly shifting by reducing reliance on smaller markets in favor of a much more concentrated network in the largest markets. WN simply does not serve near as many markets as the network/legacy carriers do.
Whether WN sells a "simple product" or not, their fares are not substantially lower than the legacy carriers because they are able to dominate the market.
There are a lot of people who would disagree that the legacy carriers are trying to sell an experience. Domestic air travel has largely been commoditized. There is some segmentation that has been done in the market and the legacy carriers absolutely do get a higher percentage of the highest revenue travelers than WN does precisely because the legacy carriers provide a more "sophisticated" product, even if it benefits a small portion of the public. That first class mean you serve from DFW-DEN is not targeted at the masses but at AA's most loyal passengers, most of whom AA is willing to invest in to ensure they don't go wondering off to another carrier.
Every legacy carrier looked at getting rid of the sophistication/complication in their networks as part of their restructurings inside/outside of BK. The airline within airline concepts all were rooted in those attempts.
Those above average quality meals that AA has been serving and which Josh laments going bye bye are leaving because it isn't competitively necessary to outperform on meals. There are only 3 mega carriers that serve meals and the overlap on their networks is just not that great.
It has only been as the costs of the low fare carriers has approached that of the legacies that the legacy carriers have decided it isn't necessary to create more complexity. B6 is adding premium cabins. And WN is flying into cities it said it never would serve - like LGA - where you can sit for 30 minutes or more waiting to take off or sometimes even get to a gate. that is complexity and not simple transportation.
WN's product is far more complex than it used to be.
Don't compare what WN did for 30 years before the legacy carriers restructure but instead look at what is happening now post Bk and post consolidation.
There are now 3 very strong and profitable airlines and one network airline that is not as strong but still controls a huge amount of revenue. Some of the niche players like AS and B6 and perhaps to a lesser extent VX have strong track records and control a decent amount of good industry revenue.
How UA comes out of this will say much about the success of the other three - or not.
WN is strong, they have navigated the changes they had to make well, and they have a solid growth plan going forward.
But their revenue performance right now is comparable to what AA and DL are doing and with a CASM that is only a few percent lower.
Given that LUV's market cap is about half the size of AAL and DAL and proportional to its size but similar to much larger UAL, the market knows where the profitability in the industry lies.