ACA - Regional Carrier Plans Bargain Airline

[iflyjetz]

----------------
On 7/28/2003 12:48:09 PM Bear96 wrote:
Chip what a surprise you are concentrating on the potential negative effect on UA about ACA going it alone. Of course you have ignored the impact to U. What will be the effect on U to have yet ANOTHER low-cost carrier (assuming ACA can pull it off) plying largely the same East Coast markets as U?
----------------​

Bear96, I was thinking the same thing about the effect that ACA starting up an east coast LCC operation would have on U, but refrained from commenting since it falls on deaf ears.

With ACAI down >20%, Wall Street doesn't their LCC plan much hope.

 

[USA320Pilot]

Bear96:
Chip said: In my first post in this thread I wrote the Washington Post wrote an independent ACA would probably force lower fares and competition with US Airways, particularly in mid-size markets.
Bear96 said: Chip what a surprise you are concentrating on the potential negative effect on UA about ACA going it alone. Of course you have ignored the impact to U. What will be the effect on U to have yet ANOTHER low-cost carrier (assuming ACA can pull it off) plying largely the same East Coast markets as U?


Chip comments: Bear, in my first post in this thread, I commented on the potential for Atlantic Coast to pressure US Airways, which you must have missed. However, just a few minutes ago Dave Siegel was asked by Ray Neidl, Blaylock partners airline analyst, what effect the announcement would have on US Airways. Siegel responded that there is nothing low cost about Atlantic Coast in their current mode and he was very skeptical that the Atlantic Coast plan could be successful. Regardless, your bolded comment about another low cost carrier is valid considering US Airways’ high unit costs, but there is reason to believe the unit costs could dramatically come down in the future. Therefore, I’m becoming more bullish on US Airways and its long-term future. Furthermore, tt appears United and Atlantic Coast could be mutually destructive in the the IAD hub, by market indications, which could give less competition to US Airways in the Washington area.
Finally, as I said before, it has come to my attention that US Airways' management intends to talk to Atlantic Coast management about a potential code share relationship, although its unclear if a deal could be worked out.
Best regards,
Chip

 

[funguy2]

I recall that the original mid-field concourse was built by upstart Presidential Airways back in the mid-80's. Not sure if they owned it, or leased it from IAD/MWAA. I think (and I am not 100% on this, so correct me if I am wrong) that the Presidential mid-field terminal is now Concourse D (I remember Presidential talking about the rotunda in the middle of the concourse). Later, Concourse C was built probably for NYAir/Continental, but UA ended up there when CO moved to CLE, and UA moved to IAD. Then when Presidential became United Express, the walkway between the two was constructed. Later, Concourse B was added, finally, Concourse A was added onto B for ACAI's ops. I remember reading that ACAI developed Concourse A independent from UA, but specifically for United Express operations.

So, based on what I have seen, and my memory, I am pretty sure (95%) that ACAI owns (or controls separately from UA) their facilies on Concourse A. In fact, I think there was a recent Airways or Airliners article about ACAI which may verify this. I think whether or not they control where mainline UA operates on C and D is more iffy. Its possible that they somehow control some of those gates, perhaps they quietly picked up some assets from Presidential's bankrupcy years ago that gave them some kind of long-term lease or ownership on part or all of Concourse D?

 

[rwills]

Y'all have it all wrong. Kerry Skeen said it best on the webcast yesterday: everyone thinks that ACA re-signing with UAL is a holy grail for them.

In actuality from all accounts, UAL was trying to extract such draconian business terms from ACA that signing with UAL for the long haul represented far more risk to ACA than flying solo.

Add to the equation a strong possibility of a 2nd chapter 11 filing assuming UAL emerges, and you have your answer: despite the state of the industry and competition from JB, SW et al, going it alone is likely the best scenario for ACA, especially given their control of gates /real estate in IAD.

All the other regionals that are signing w/United may have some nasty surprises awaiting them in the next year(s).

 

[iflyjetz]

rwills, ACAI took quite a haircut yesterday; down 24%. How's it doing today? Another haircut; down 15%. Wall Street says that ACA's toast.

Exactly how many gates does ACA control at IAD? I've read varying statements.

Unless ACA has a lot of capitalization, it could be shuttering its doors 24 months after breaking up with UAL.

 

[Segue]

----------------
On 7/29/2003 10:08:57 AM iflyjetz wrote:

rwills, ACAI took quite a haircut yesterday; down 24%. How's it doing today? Another haircut; down 15%. Wall Street says that ACA's toast.

Exactly how many gates does ACA control at IAD? I've read varying statements.

Unless ACA has a lot of capitalization, it could be shuttering its doors 24 months after breaking up with UAL.

----------------​

LOoks like their position is good at this point.....

http://biz.yahoo.com/fool/030729/1059493200_1.html

I'm actually thinking of buying. LCC is the only business model that seems to work. Its a big speculation that they can get there I know, but the gates are a huge asset and they already have the rest of the infrastructure.

 

[BDLDFW]

----------------
One the other hand, this will bring in additonal LCC competiton in the East Coast - probably will have a receptive customer audience! It is a very gutsy move. Could they be the next Jet Blue?
----------------
​

How about Dick Branson's Virgin America?

 

[Segue]

----------------
On 7/29/2003 12:06:52 PM BDLDFW wrote:

----------------
One the other hand, this will bring in additonal LCC competiton in the East Coast - probably will have a receptive customer audience! It is a very gutsy move. Could they be the next Jet Blue?
----------------
​

How about Dick Branson's Virgin America?

----------------​

Yes...good idea too and a visionary, consumer focused, leader. While the majors squable about things like R&D and pushback, the newbies will come in hire up all those already out of work.

 

[ual06]

----------------
On 7/29/2003 12:37:56 PM Segue wrote:

----------------

On 7/29/2003 12:06:52 PM BDLDFW wrote:

----------------

One the other hand, this will bring in additonal LCC competiton in the East Coast - probably will have a receptive customer audience! It is a very gutsy move. Could they be the next Jet Blue?

----------------
​

How about Dick Branson's Virgin America?


----------------​

Yes...good idea too and a visionary, consumer focused, leader. While the majors squable about things like R&D and pushback, the newbies will come in hire up all those already out of work.

----------------​

I just wonder if the Air Traffic Control System in the Northeast United States can hack it. I
doubt it. Heading back to gridlock. It doesn't matter if it is a B-747 with 400 on board or an
RJ with 40 on board. Each requires the same amount of "protected airspace".

 

[Farley]

I'm glad ACA let UAL sign up the lowest bidders, and stepped aside. To those who said "good riddance" to ACA (that would be Busdrvr), wait until your quality lowest bidder operations get going. I'm glad to see you exhibit so much ALPA solidarity. How could you have such a sentiment in times like these?

 

[rwills]

One last point from me on this.. keep in mind aca has about $150 million in cash and less than a third of that in debt. Add this to 13 years of operating experience as an airline and you have the best of three worlds: start up airline With Cash With A/C and With Experience. Notwithstanding their position and all due respect to the analysts on Wall Street, ACAI stock

looks like a diamond in the rough.

 

[smfav8r]

crjguy,

You make some valid points, but I think your looking at the past 6-7 years of ACA....back in 93-94 the company almost went out of business.....dollars from shutting the doors....BAE bailed them out....Kerry Skeen was at the helm then too....they have some good assets, but I wouldn't give any credit to experience in management...Old Acker fled the country the day after ACA crashed the 41 up in Ohio....great leadership from a CEO....just something to think about!!!
Keep the greasy side down and pointy end foward!!!!