An over the horizon view

[Ukridge]

Something I, as an outside observer, am genuinely interested in. I would like to solicit the ideas of where everyone thinks the world airline industry is going or what it is evolving or devolving (as your case might be) into.

Sounds like sort of a weighty question and indeed it may be, but certainly is must be moving toward something? Tighter and tighter global alliances? Only a few carriers left in markets such as the U.S.? Try to look as far over the horizon to see where it is all shaking out.

I look at KLM/AF, BA, and Virgin on my doorstep and that gives some slight indication of a trend line but I would be interested in hearing what those on this board think is going to be the shape of the global air market in five, ten, and even fifteen years out. I ask this of my friend at BA and I thought it would be interesting to get ideas from what by all outside appearances seems to be the most competitive air market in the world--that of the U.S.

I entitled this thread (in the sub) as an intelligence test. I am sure that some replies (if I even garner any) will be tend toward the myopic and vulgar. If so, perhaps there is a reason (as my grandfather used to say) why you are pushing the broom. Stretch, think, ponder, and reply.

Seriously, other than letting the market brutally and unseemingly sort out the issue, are there any visionaries who are looking to the future to see what kind of product is going to be provided?

Cosmo? Jim? 767jetz? Any ideas?

 

[NewHampshire Black Bears]

"U",

For starters, the answers for the FUTURE, (that you seek), will be GREATLY determined here(in the USA)...by the date of 11/04/08 !!

 

[Ukridge]

Ah! It took me a moment to figure this one out. As you know we write our dates a bit differently and I was confused in trying to figure out what had happened on the 11th of April 2008. It took me a moment, but I assume you are refering to your presenditial election?

Need I remind you however, that over 200 years ago we tried to impress upon you the benefits of remaining under the monarchy? 😉 If so, you would not have to bother with such inconveniences...

Not sure though how a new U.S. president is going to shape the market forces that are bearing down on the air industry but would be interested to see what you are implying. Do you think there will be a relaxation of foreign ownership/controlling laws? Perhaps a tightening of them?

"U",

For starters, the answers for the FUTURE, (that you seek), will be GREATLY determined here(in the USA)...by the date of 11/04/08 !!

 

[NewHampshire Black Bears]

Ukridge,

To your question, I'm not sure what a total Democratic party victory/control of the US government will mean.

I'm quite sure that an Obama administration would have "nixed" a DL/NW merger, given the fact that NW was not in dire $$$ straits(they are in better $$ shape than DL).

I'm inclined to think that "they" would be LESS Foreign ownership etc.

One thing that I DO KNOW for SURE is that an Obama administration, coupled with a Democratic "ruling" congress is NOT enamoured with the Infectious Disease that grips the USA presently. I'm speaking of course,.. of........CAPITALISM..at "ANY COST"(emphasis) MORE on "ANY COST" , than Capitalism)

I often remark to friends(of both political stripes) that 10 years ago, "we" had a good chuckle at the expense of our Wonderful neighbors to the north..CANADA, as it pertained to their currency, and Medical Insurance for ALL(similar I'm told as yours in the UK.)

Well I can say without error, that NO ONE here in the good ol' USA is poking fun at the Canadians these days !!

I would STRONGLY caution our allies in the UK/EU...Australia..New Zealand etc. to BEWARE the INFECTION of GWB's..Capitalism at ANY COST, because those countries that I've mentioned are NOT Immune !!

I've drifted a bit, so back to Commercial Aviation.

I suspect that An Obama Administration would "prop up" a susceptible carrier(like perhaps a US Airways) to a certain degree/point, but in the End I feel the "Law of the Jungle" will prevail.

On a side note, It was good to converse with you !!

 

[L1011Ret]

Something I, as an outside observer, am genuinely interested in. I would like to solicit the ideas of where everyone thinks the world airline industry is going or what it is evolving or devolving (as your case might be) into.

Sounds like sort of a weighty question and indeed it may be, but certainly is must be moving toward something? Tighter and tighter global alliances? Only a few carriers left in markets such as the U.S.? Try to look as far over the horizon to see where it is all shaking out.

I look at KLM/AF, BA, and Virgin on my doorstep and that gives some slight indication of a trend line but I would be interested in hearing what those on this board think is going to be the shape of the global air market in five, ten, and even fifteen years out. I ask this of my friend at BA and I thought it would be interesting to get ideas from what by all outside appearances seems to be the most competitive air market in the world--that of the U.S.

I entitled this thread (in the sub) as an intelligence test. I am sure that some replies (if I even garner any) will be tend toward the myopic and vulgar. If so, perhaps there is a reason (as my grandfather used to say) why you are pushing the broom. Stretch, think, ponder, and reply.

Seriously, other than letting the market brutally and unseemingly sort out the issue, are there any visionaries who are looking to the future to see what kind of product is going to be provided?

Cosmo? Jim? 767jetz? Any ideas?

Well I will not take you task about the Monarchy, but we are having elections here, King George must step down. Many will breathe easier. As to the future of aviation, I think the elections hold a key. The idea of re-regulation after 30+ years of deregulation is repeatedly being discussed here. The father of deregulation Alfred Kahn now has great reservations about deregulation as does Robert Crandall. If it is a Republician administration, expect the Darwinian approach, survival of the fittest. Very bloody, no goverment intervention. If Democratic administration the possibility exists for some form of pricing rules. Less bloody. The industry and its clients are just not suited to unfettered deregulated aggressive capitolism. Of course neither was the housing debacle even though you did not have a to have a crystal ball to see that unfettered forms of selling houses and unfteered trading of monetary instruments linked to housing would lead to disaster. Sooner or later there will be about 6 major carriers to maintain competition. It will be bloody but Congress may take some steps that will enable a post deregulation strategy to prevail. SEE this for good ideas, probably one of our most insightful people when it comes to aviation. http://www.wingsclub.org/eventspeeches_2008-06.html

 

[1Conehead]

Ukridge,

To your question, I'm not sure what a total Democratic party victory/control of the US government will mean.

Socialism/communism of which I am against .

 

[NewHampshire Black Bears]

Socialism/communism of which I am against .

"Cone..HEAD",,

Why, since you from ATLANTA, would I expect any other kind of an answer !!


Wanna' make a Cyber BET, that Johnny Mac(GOP) do NOT carry Georgia on 11/04/08 ??

 

[RowUnderDCA]

I've often wondered about what kind of re regulation would occur.

What would happen if the gov simply stated that every airline serving a market had to move pax (in a seat of some sort) from point a to point b for one price, say with no more than one connection? The gov wouldn't set the price, but simply state that you could only offer one price.

Better seat.. more money. Refundable.... more money. Goodies....more money.

Basically kill yield management all together.

What about a range: no more than 100% higher than the lowest fare.

And no free tickets. Upgrades for better service could be sold for FF miles that were earned or bought. in fact every 'upgrade' could be bought with FF miles, bought or earned or gifted.

 

[Richard]

Since this has nothing to do with UA in particular, it's moving over to the water cooler.

 

[jimntx]

Though having a single price for transportation from Point A to Point B would make life simpler in a lot of ways for a lot of people, it ignores the basic economics of the transportation business in general, and the airline business specifically.

Why do you think that 5-star hotels permit their unsold rooms to be sold on Priceline and Hotwire for a fraction of the price they sold it to your travel agent 3 days in advance? A hotel room or an airline seat is a perishable commodity. If that room goes empty tonight, that is revenue that can never be recovered. If an a/c pushes back with empty seats, that is revenue that is lost forever.

The Catch-22 is single unit pricing is that it has to assume constant demand. There is the same clamor for seats today that there will be tomorrow. We all know that is not so. That works on the Dallas North Tollway where they know that people will pay (almost any price) for the privilege of avoiding I-35 North andUS75 North. And, they will do it everyday Monday-Friday.

Airline seat demand varies not only by day, but by month and season. Getting $100 for $1000 seat is still better than getting nothing. Though, I grant you that the continued rise in jet fuel prices will soon modify that statement to getting $200 for $1000 seat...The $100 will no longer pay for lifting the bottom in that seat off the ground.

Have been flying. Will post thoughts on whither thou goest, airline industry when I've had some rest.

 

[cooper43]

Socialism/communism of which I am against .

IMHO under the GW administration we have seen the nasty side of capitalism. Everything is good in moderation. I would like to see our nation return to a more moderate capitalism. Where corporate profits are balanced with the good of the people. At the present it is "Kill or be Killed". For the past 71/2 years we have had no one in Washington protecting the working man.

 

[NewHampshire Black Bears]

IMHO under the GW administration we have seen the nasty side of capitalism. Everything is good in moderation. I would like to see our nation return to a more moderate capitalism. Where corporate profits are balanced with the good of the people. At the present it is "Kill or be Killed". For the past 71/2 years we have had no one in Washington protecting the working man.

///////////////////////////////////////////////////////////////////////////////////////////////////////////////

copper43,

Be patient.
November 04, 08/Jan 20,2009 will be here, before you know it !!!!!!!!!!!!!!!!!

 

[delldude]

IMHO under the GW administration we have seen the nasty side of capitalism. Everything is good in moderation. I would like to see our nation return to a more moderate capitalism. Where corporate profits are balanced with the good of the people. At the present it is "Kill or be Killed". For the past 71/2 years we have had no one in Washington protecting the working man.

Don't know if you've bothered to notice but your pals on the left haven't done much at all either for the past 4 or 5 administrations except take your contributions and hard earned money.

 

[Ralph]

:cop: WARNING! TOPIC DRIFT! DANGER! DANGER! :cop:

Some of you seem to have a hard time understanding topic titles. Ukridge asked for a serious, ADULT discussion of the future of the airline business--to the extent that any of us could discuss it with the limited view that each of us has.

The fake-political yah-yah back and forth over whose party is the most evil is to stop! If you want to continue such childish arguments like "your political party eats boogers no yours does", start a separate thread. Quit highjacking every attempt to have a serious discussion. Time off can be given to those who choose to ignore this warning.

Also, note Ukridge's subtitle, "Plus an intelligence test." Some of you are failing at this point.

 

[Cosworth]

Part of me wonders if we will not see smaller a/c serving markets. With fuel prices the way we are and the economy headed to the basement, I do not see how most people will be able to afford to fly. Airlines, especially the big ones cannot afford to pay labor and fuel costs. I can envision foreign own airlines, out sourced maintenence, contracted crews and substantially reduced service. Planes are not like cars where alternate fuel sources are easily utilized.

The airlines should be great full that the car/oil companies got rid of public transportation. Had trains been left to flourish like they have through out Europe, the airlines would have been on a world of hurt quite some time ago. I know for my self, on a trip of 200-700 miles or so, I'll take a train if given the choice.

I think all the contract stuff is going to be quite entertaining. All the folks who think they took a bath over the past few years are going to be in for rude awakening in my opinion. I have a feeling it is only going to get worse. World demand for oil is going to ensure that the price goes up, not down (last I heard it was selling at $140+ pb) and I do not care who gets in office come November.

I do not see regulation as the answer. The only thing I can see saving air travel is technology. Something that reduces the cost of operation. What that is I have no idea.