Is This The Fire Sale?

[sfb]

See:

US Airways Offers Systemwide Savings with Two-Day Sale

Now the sale fares are only good for the low season through mid-December (and likely unavailable for Columbus Day and Thanksgiving), but there's no way that the company makes money on a $158 round-trip between BOS and IAH or $98 between SYR and MIA.

Is this an attempt to pump up the cash position in advance of the upcoming cash targets?

 

[usair_begins_with_u]

LOL.. it means bookings are taking a hit due to BK filing.. Buyer Beware..

 

[GadgetFreak]

LOL.. it means bookings are taking a hit due to BK filing.. Buyer Beware..

[post="182664"][/post]​

Yes, that would be my guess. Not laughing though. I was afraid this would happen. If the bookings really fall off this will be over very quickly. Unfortunately it will likely be self fulfilling. People see the sales, people get even more worried and dont buy tickets anyways. It can easily turn into a vicious cycle. To some extent I dont see how Ch7 will be avoided. Im really trying to figure out what will happen after that. Will they try to rescue parts of US as another carrier or just sell it all off.

 

[cavalier]

Yes, that would be my guess. Not laughing though. I was afraid this would happen. If the bookings really fall off this will be over very quickly. Unfortunately it will likely be self fulfilling. People see the sales, people get even more worried and dont buy tickets anyways. It can easily turn into a vicious cycle. To some extent I dont see how Ch7 will be avoided. Im really trying to figure out what will happen after that. Will they try to rescue parts of US as another carrier or just sell it all off.

[post="182667"][/post]​

Like several of the business in my hometown here which was flooded making everything thing seem surreal. I talked to a few business owners who said they have had enough, and the same will hold true for the creditors and money people who had enough of U's woes and lack of management and say the same thing, enough already.

 

[AtlanticBeach]

Is this an attempt to pump up the cash position in advance of the upcoming cash targets?

[post="182663"][/post]​

That was my first thought, too. But the sequence of e-mails last night and this morning look like some of this is a match to Southwest. Only available Monday through Thursday on U S, but W N has the fares 7 days a week.

Anyone in res have income numbers from last week and prior year comparisons?

 

[usfliboi]

You want us to do nothing? I mean first people complain they dont then they do ! Geess

 

[BoeingBoy]

I just saw the full-page ad in USA Today this morning (free at the hotel - I am a pilot, after all) and wondered if it was due do a drop in bookings too. Someone mentioned a response to SW - I know they announced a fare sale a few weeks back. Have the kicked off a new one that I missed?

Jim

 

[mrfish3726]

DESPERATION!

 

[Phantom Fixer]

I see two possible reasons for this situation.

(1) Bronner's comments and the filing of Chapter 11 have really made such a negative impact on bookings to the point that something had to be tried out of shear desperation , or

(2) By lowering the fares now..and hoping that advanced bookings will skyrocket in light of it , the company can then make a case with the judge that it's not the customers avoiding us that's the problem..it's what the labor costs are doing to us that makes us less than competative.

Then thier is a third or forth possible scenario

(1) Issues one and two have had a combined effect?

(2) The company is lowering its earning potential to the point that the judge will offer the company carte blanche with our contracts and work rules to offset what they see as a need to become competative.

 

[javaboy]

drop in bookings are consistent with DR Bronners comments.

the man has spoken on labor issues 3 times since becoming chairman and every time EVERY time he has spoken (i really dont know if he has 0 clue as how to live with labor or what) but seemed that he was attempting to "scare" unions into signing very quickly or else. he neglects to understand that people book weeks and months out. so even if the labor groups had signed exactly what he wished the drop in booking would still have occurred same as in the past. It starts 4 weeks out and will continue for 4-6 weeks. (based on his "liquidation" speeches) nobody will book more than 60 days out (within 60 days credit cards purchases will be protected under the dispute the charge law which yep you guessed it gives you recourse upto 60 days) bookings will mildly increase approaching the Thanksgiving holiday and again for Christmas and New years time frame. beyond that is the key. make spring and revenues continually improve thru spring and summer. gotta survive the winter though.

 

[AtlanticBeach]

Someone mentioned a response to SW - I know they announced a fare sale a few weeks back. Have the kicked off a new one that I missed?

Jim

[post="182683"][/post]​

Yes, they announced yesterday. Same fares that Airways matched, with fewer restrictions.

 

[N628AU]

This is a typical sale for this time of year, many carriers run them. As for bookings falling off, Lakefield said last week the bookings on Tuesday, the 1th, two days after the filing were up 14% from the previous week.

 

[Phantom Fixer]

This is a typical sale for this time of year, many carriers run them. As for bookings falling off, Lakefield said last week the bookings on Tuesday, the 1th, two days after the filing were up 14% from the previous week.

[post="182710"][/post]​

N6,


While most will agree with your overview on it being a financial world , for many the problem still persists that it's not the employee's or thier collective earnings that prevent U from being a viable player in today's world.

So far management has only addressed the employee's wages and benefits as the source of the ills..but little to nothing is being done to reform the business model itself.

Most of all the U employee's whom are unionized are making a good deal less than their WN counterparts....but that is not the gradiant scale for our management..they operate from the standpoint of competing with relative newcomers in the industry , Not a company with a proven year over year track record of the likes of WN.

For U to compete with B6 , WN , HP ,F9 or anyone of this type...the fleet will have to be gutted to a single fleet type...and hence there goes what U has traditionally offered its customers for many years now.

U with trans-atlantic routes...and a fleet that supports doing so , comes at a price in logistics alone that niether a WN or B6 has to contend with...simply the for Hybrid LCC concept to work at all...the business model will have to change to such a degree that not only will the traditional U passengers not appreciate whats being offered...the employee's are going to feel the same way as the traditional "revolving door " people at the commuters feel towards their jobs in many instances...and service will suffer accordingly.

The numerous comments on how MESA and Shuttle America have blackend U's image stands as a shinning example of what I'm speaking of. You shall get what you pay for on both sides of the coin.

 

[BoeingBoy]

AtlanticBeach,

Thanks.

Jim

 

[sfb]

Honestly, I don't see this as a match of WN, given information in the press release for their sale. Their sale runs for another month on most routes (excluding BWI), is less aggressive on pricing for most routes, and are good through end-of-schedule in January. As an example, WN's sale fares from BWI were announced as $59 each way, non-peak, to Florida and $92 each way to MDW. Those same routes in the US sale are $49 each way; WN has matched US for comparable itineraries. I'd add that the US sale is systemwide, and not limited to WN cities as it would be if this were a match.

Empty seats don't make money for the company, but these sorts of fares aren't sustainable either.