Low-fare Carriers Call For United Cuts
- Thread starter blueskies4ever
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Since Ual works off of the hub and spoke system, giving up any slots seems like a bad idea for Ual's business model and goes against their arguments imo.
They do seem to be very involved in Ual's welfare. huh?
They do seem to be very involved in Ual's welfare. huh?
ELP_WN_Psgr
Senior
- Nov 29, 2003
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Well, let me ask the question....
while UA is in bankruptcy protection, just how much are they paying for their gate & counter space?
Did they repudiate a lot of debt owed to cities and airport authorities when they filed for bankruptcy?
The issue to me is not whether or not they close stations or don't close stations.
The issue is are they paying for the gates at these various airports, just as their competitors have to do?
If UAL has defaulted or failed to pay what they owed in gate and terminal rentals, then the LCCs who are hollering have a fairly valid point. It is unfair for UA to operate without being subject to the same costs and expenses that confront every other airline. An unfair advantage and certainly not a level playing field.
And the big so-called major carriers did this to WN when it came to how air fares would be taxed (someone touched on that earlier).
They pushed and squalled for a lower percentage tax plus a "per leg" tax, thinking that would hinder WN....as they hopscotched cross country stopping at any airport that could handle a 737.
What it did was puch WN into the transcon business, much to the chagrin of the socalled major carriers. The law of unintended consequences at work.
while UA is in bankruptcy protection, just how much are they paying for their gate & counter space?
Did they repudiate a lot of debt owed to cities and airport authorities when they filed for bankruptcy?
The issue to me is not whether or not they close stations or don't close stations.
The issue is are they paying for the gates at these various airports, just as their competitors have to do?
If UAL has defaulted or failed to pay what they owed in gate and terminal rentals, then the LCCs who are hollering have a fairly valid point. It is unfair for UA to operate without being subject to the same costs and expenses that confront every other airline. An unfair advantage and certainly not a level playing field.
And the big so-called major carriers did this to WN when it came to how air fares would be taxed (someone touched on that earlier).
They pushed and squalled for a lower percentage tax plus a "per leg" tax, thinking that would hinder WN....as they hopscotched cross country stopping at any airport that could handle a 737.
What it did was puch WN into the transcon business, much to the chagrin of the socalled major carriers. The law of unintended consequences at work.
"I doubt UAL paid money for many of their slots, sure LGA and a few others, but far from all. I think the LCC's feel, that UAL is sitting on access while losing money, for no other reason than to keep the LCC's out. Needless to say, the LCC's perceive they can make money."
Hmmm, did all those folks that set out west for land grants "pay" for land? Should we take back the things they "developed"? Where was FRNT, Blu, ect when aviation was in it's infancy and folks like Jepp (a ual pilot) were making Aviation safe? When they "developed" the system you use today? Is there a value to that?
"Obviously, it will be a point of contention between the legacies and the LCC's both now and in the future, that is access to airports. ORD is a good example, with AA/UAL controlling 80% or more of access."
Hmm, how many slots does UAL "control" at ORD? As a matter of fact, the exact OPPOSITE is true. UAL and AMR have been asked to cut back, while ANYONE ELSE CAN GROW AT WILL!! Is that what you refer to? Or are you refering to the "beyond perimeter" slots at DCA? "Slots" at DEN? (none), SFO (none), LAX? (none), IAD? (none), MIA? (none). Oh I guess you mean the ones at NRT and LHR....
"This behavior is certainly not exclusive to LCCs. I seem to recall the push that the legacies made to have taxes apply per-hop rather than per-ticket or per-mile, because of WN's structure."
What the majors want is a "level" playing field. Wn should pay for it's portion of services rendered by the feds just like everyone else. A UAL 777 going transcon pays significantly more to the government than a 737 doing a 5 hopper, yet uses MUCH less government services. Level field, fee for dept. It's also of note that just about all REAL unregulated industries have matured to typically three big companies. but not the airlines. Why? The GOVERNMENT has stopped it (with heavy lobbying by LCC's). Seems they think it will make traveling on the bigs too convenient... Yup, that was Wn's argument. They didn't want consolidation because it would benefit the customer (at Wn's expense of course.....)
Hmmm, did all those folks that set out west for land grants "pay" for land? Should we take back the things they "developed"? Where was FRNT, Blu, ect when aviation was in it's infancy and folks like Jepp (a ual pilot) were making Aviation safe? When they "developed" the system you use today? Is there a value to that?
"Obviously, it will be a point of contention between the legacies and the LCC's both now and in the future, that is access to airports. ORD is a good example, with AA/UAL controlling 80% or more of access."
Hmm, how many slots does UAL "control" at ORD? As a matter of fact, the exact OPPOSITE is true. UAL and AMR have been asked to cut back, while ANYONE ELSE CAN GROW AT WILL!! Is that what you refer to? Or are you refering to the "beyond perimeter" slots at DCA? "Slots" at DEN? (none), SFO (none), LAX? (none), IAD? (none), MIA? (none). Oh I guess you mean the ones at NRT and LHR....
"This behavior is certainly not exclusive to LCCs. I seem to recall the push that the legacies made to have taxes apply per-hop rather than per-ticket or per-mile, because of WN's structure."
What the majors want is a "level" playing field. Wn should pay for it's portion of services rendered by the feds just like everyone else. A UAL 777 going transcon pays significantly more to the government than a 737 doing a 5 hopper, yet uses MUCH less government services. Level field, fee for dept. It's also of note that just about all REAL unregulated industries have matured to typically three big companies. but not the airlines. Why? The GOVERNMENT has stopped it (with heavy lobbying by LCC's). Seems they think it will make traveling on the bigs too convenient... Yup, that was Wn's argument. They didn't want consolidation because it would benefit the customer (at Wn's expense of course.....)
"The issue is are they paying for the gates at these various airports, just as their competitors have to do?"
Yes they do. they have protection in BK, but as a leasor, the Airports can kick UAL to the curb if they like. That'd be real good for the local economy though, losing access to all of UAL's markets. But I'm sure NWA would stay as a monopoly carrier to the pacific. Small communities take note, the LCC's want to make money at your expense (at least at the expense of your empoyers...) You think it's a coincidence that Dulles and Den grew to be huge high tech employers?
"They pushed and squalled for a lower percentage tax plus a "per leg" tax, thinking that would hinder WN....as they hopscotched cross country stopping at any airport that could handle a 737.
What it did was puch WN into the transcon business, much to the chagrin of the socalled major carriers. The law of unintended consequences at work."
Actually, Wn's transcons are not a big problem for the majors. How many they got? How many daily seats? NYC-SFO, LAX? IAD-SFO, LAX? BOS-LAX, SFO? Urban legend. But just as you said, if the majors have to pay just as much to use gates as the little guys, then the little guys should pay just as much to use the airspace and to land at airports. Fair's fair, right?.... <_<
Yes they do. they have protection in BK, but as a leasor, the Airports can kick UAL to the curb if they like. That'd be real good for the local economy though, losing access to all of UAL's markets. But I'm sure NWA would stay as a monopoly carrier to the pacific. Small communities take note, the LCC's want to make money at your expense (at least at the expense of your empoyers...) You think it's a coincidence that Dulles and Den grew to be huge high tech employers?
"They pushed and squalled for a lower percentage tax plus a "per leg" tax, thinking that would hinder WN....as they hopscotched cross country stopping at any airport that could handle a 737.
What it did was puch WN into the transcon business, much to the chagrin of the socalled major carriers. The law of unintended consequences at work."
Actually, Wn's transcons are not a big problem for the majors. How many they got? How many daily seats? NYC-SFO, LAX? IAD-SFO, LAX? BOS-LAX, SFO? Urban legend. But just as you said, if the majors have to pay just as much to use gates as the little guys, then the little guys should pay just as much to use the airspace and to land at airports. Fair's fair, right?.... <_<
Boy, hit a nerve did I?
"When they "developed" the system you use today? Is there a value to that?" You cannot be serious, that you expect other airlines to pay for that. How about the expertise to fly transatlantic or transpacific, did UAL pay for that or did someone else pave the way?
Can anyone gain access to ORD, well not really, there is no gate space available. The FAA asked both UAL and AA to cut down on flights due to congestion, which was causing excessive delays, much like what happened at LGA.
Busdrvr,
I think you need to look at the big picture and stop looking at UAL like a saint. Great company yes, Saint no. UAL has taken advantage of other airlines misfortune, UAL has pushed for plenty of things, that was detrimental to other airlines.
I am not attacking UAL, merely giving another point of view to the "LCC's are evil for trying to get a leg up", when we both know, UAL would do exactly the same thing. As a matter of fact, pursuing the loan guarantee is just that, using the goverment to get the lowest interest rate. Smart move, IMHO, but that does not necessarily make it popular with your competitors.
"When they "developed" the system you use today? Is there a value to that?" You cannot be serious, that you expect other airlines to pay for that. How about the expertise to fly transatlantic or transpacific, did UAL pay for that or did someone else pave the way?
Can anyone gain access to ORD, well not really, there is no gate space available. The FAA asked both UAL and AA to cut down on flights due to congestion, which was causing excessive delays, much like what happened at LGA.
Busdrvr,
I think you need to look at the big picture and stop looking at UAL like a saint. Great company yes, Saint no. UAL has taken advantage of other airlines misfortune, UAL has pushed for plenty of things, that was detrimental to other airlines.
I am not attacking UAL, merely giving another point of view to the "LCC's are evil for trying to get a leg up", when we both know, UAL would do exactly the same thing. As a matter of fact, pursuing the loan guarantee is just that, using the goverment to get the lowest interest rate. Smart move, IMHO, but that does not necessarily make it popular with your competitors.
ELP_WN_Psgr
Senior
- Nov 29, 2003
- 419
- 0
Actually, Wn's transcons are not a big problem for the majors. How many they got?
They may not be a big problem for the majors. Yet.
20 years ago WN had just begun to send a limited number of routes outside the state of Texas and they didn't represent a problem for anyone except for maybe Braniff.
10 years ago WN, with 8 or so flights a day out of Baltimore, wasn't much a problem for U.
The problem now is not that they have a handful of transcons and are stealing every passenger that would otherwise jump on AA or UA.
The problem is they offer a viable alternative and now have pricing power in some key markets. JetBlue is the same way - it's not that they carry all the pax....it's that all the pax travel at the prices defined by the LCC.
They may not be a big problem for the majors. Yet.
20 years ago WN had just begun to send a limited number of routes outside the state of Texas and they didn't represent a problem for anyone except for maybe Braniff.
10 years ago WN, with 8 or so flights a day out of Baltimore, wasn't much a problem for U.
The problem now is not that they have a handful of transcons and are stealing every passenger that would otherwise jump on AA or UA.
The problem is they offer a viable alternative and now have pricing power in some key markets. JetBlue is the same way - it's not that they carry all the pax....it's that all the pax travel at the prices defined by the LCC.
Faberman is a shameless, baldfaced whiner. He probably thinks that the DOT has listened to him in the past. I'd doubt the ATSB will.
Could WN make the same arguement that a UA RJ takes just as much resources as a WN 737, but WN pays moreBusdrvr said:
"Could WN make the same arguement that a UA RJ takes just as much resources as a WN 737, but WN pays more"
"Sure they can.....a United Express RJ, right?"
ABSO-F-IN-LUTELY!!!! Do you really think the UAL guys will shed big tears because a 737 may then become the more economical choice? Or that some markets upguage to a 76 from a 320? Do you think pax will complain when economic incentives eliminate "gridlock" across the country? WN flies OVER 30 flights a day between Dallas and houston. Do you think the npublic good would be better served with fewer more economical flights on larger equipment? Less fuel burned? Less government employees used?
"Sure they can.....a United Express RJ, right?"
ABSO-F-IN-LUTELY!!!! Do you really think the UAL guys will shed big tears because a 737 may then become the more economical choice? Or that some markets upguage to a 76 from a 320? Do you think pax will complain when economic incentives eliminate "gridlock" across the country? WN flies OVER 30 flights a day between Dallas and houston. Do you think the npublic good would be better served with fewer more economical flights on larger equipment? Less fuel burned? Less government employees used?
ELP_WN_Psgr
Senior
- Nov 29, 2003
- 419
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WN flies OVER 30 flights a day between Dallas and houston. Do you think the npublic good would be better served with fewer more economical flights on larger equipment? Less fuel burned? Less government employees used?
The short answer is no.
PSA tried running intra-California (a little bit longer than Dallas--->Houston) with L-1011s and it didn't work. At all.
The problem....
The automobile.
Commuting businessmen want frequency. Thirty trips a day is frequency. That's something like 4110 seats.
You could put 10 747s on the route, basically, and have the same # of seats.
Would businessmen flock to flights leaving every 90 minutes to 2 hrs....in the same numbers that they do to flights leaving at 15 and 30 minute intervals?
You might fill the 7:30 AM 747 up but you sure as heck are going to be hurting when it comes to the 1:30 pm or the 10 pm at night.
So what are the commuting businessmen going to do when their frequent flights disappear? They are going to hop in their automobiles.
And tax the highway system.
And have car wrecks. Which will tax the emergency fire and rescue departments as well as the highway patrol and probably the coroner in Navarro county.
And burn more fuel than would have been burned had they lined up and hopped on one of 30 737s a day.
That's the beauty of the free market. Even though taxes constitute between 18% and 40%+ of the ticket cost (depending on what fare bucket you bought from), folks are still lining up in sufficient numbers to make those 30-some-odd flights a day profitable.
Would they line up in similar numbers to ride a big airplane which runs fewer trips? Highly unlikely.
The short answer is no.
PSA tried running intra-California (a little bit longer than Dallas--->Houston) with L-1011s and it didn't work. At all.
The problem....
The automobile.
Commuting businessmen want frequency. Thirty trips a day is frequency. That's something like 4110 seats.
You could put 10 747s on the route, basically, and have the same # of seats.
Would businessmen flock to flights leaving every 90 minutes to 2 hrs....in the same numbers that they do to flights leaving at 15 and 30 minute intervals?
You might fill the 7:30 AM 747 up but you sure as heck are going to be hurting when it comes to the 1:30 pm or the 10 pm at night.
So what are the commuting businessmen going to do when their frequent flights disappear? They are going to hop in their automobiles.
And tax the highway system.
And have car wrecks. Which will tax the emergency fire and rescue departments as well as the highway patrol and probably the coroner in Navarro county.
And burn more fuel than would have been burned had they lined up and hopped on one of 30 737s a day.
That's the beauty of the free market. Even though taxes constitute between 18% and 40%+ of the ticket cost (depending on what fare bucket you bought from), folks are still lining up in sufficient numbers to make those 30-some-odd flights a day profitable.
Would they line up in similar numbers to ride a big airplane which runs fewer trips? Highly unlikely.
Methinks you're exaggerating the impact of the shift to larger aircraft.
Look, there's clearly a point of diminishing returns on flights running a route. An aerial conveyor belt is hardly necessary. When you reach 30-minute intervals, you've pretty much maxed out the frequency benefit. In fact, for most routes, sub-hour intervals are the max-out point. Especially on longer routes, where there tends to be one or two clear "prime time" demand windows.
Look, I understand the central nature of the single-fleet approach to WN's business model. But as the demand for air travel continues to rise in this country, the approach of adding capacity by adding frequency starts to cause the system to break down. It's the same as the freeways; major metropolitan areas would be able to carry an order of magnitude more people if they were in buses instead of cars. We're already seeing frequent ground holds in many parts of the country due to congestion, even on clear-weather days. It's time for a change.
At the very least, I concur that each flight should pay the same amount to the ATC system. ATC is supposed to be a non-profit service, so it should be providing services at cost.
Look, there's clearly a point of diminishing returns on flights running a route. An aerial conveyor belt is hardly necessary. When you reach 30-minute intervals, you've pretty much maxed out the frequency benefit. In fact, for most routes, sub-hour intervals are the max-out point. Especially on longer routes, where there tends to be one or two clear "prime time" demand windows.
Look, I understand the central nature of the single-fleet approach to WN's business model. But as the demand for air travel continues to rise in this country, the approach of adding capacity by adding frequency starts to cause the system to break down. It's the same as the freeways; major metropolitan areas would be able to carry an order of magnitude more people if they were in buses instead of cars. We're already seeing frequent ground holds in many parts of the country due to congestion, even on clear-weather days. It's time for a change.
At the very least, I concur that each flight should pay the same amount to the ATC system. ATC is supposed to be a non-profit service, so it should be providing services at cost.
So these supposedly savvy businessmen are going to jump into their cars for a five hour drive in order to avoid a 90-minute wait at the airport? Don't know about that.ELP_WN_Psgr said:
Certainly frequency is important but I think you are exaggerating a bit.
ELP_WN_Psgr
Senior
- Nov 29, 2003
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Let's compare the trip from Dallas to Houston vis automobile vs via air.....
To make air travel look as competitive as possible, we will look at WN's flights from Love Field to Hobby since they are closest to the cities' central business districts:
Leave office parking lot: 0800 hrs
Method 1: automobile
Head SSE on Interstate 45 241 miles to Houston
Travel time (with gas stop) right at 4 hrs. Arrive at your destination 1200 hrs
Method 2: airline
Leave office parking lot: 0800 hrs
Arrive parking lot, Dallas Love Field 0820
Arrive terminal - 0835
Check in for flight - 0840
Flight departs - 0930
Flight arrives Houston Hobby - 1025
Procure rental car - 1045
Leave rent car lot - 1100
Arrive destination downtown - 1125 hrs
Yes, flying is less stressful....but the time savings are negligible.
If faced with a situation where a flight does NOT leave at 30 minute increments.....the prudent business traveler is just gonna say "to hell with it" and hop in his or her car and go.
But in the big scheme of things, it really doesn't matter. The so-called major carriers prevailed in this argument - they managed to get the method of taxation modified to "sock it to" WN. It resulted in a drop in short haul travel, but not egregious enough to hurt the bottom line.
To make air travel look as competitive as possible, we will look at WN's flights from Love Field to Hobby since they are closest to the cities' central business districts:
Leave office parking lot: 0800 hrs
Method 1: automobile
Head SSE on Interstate 45 241 miles to Houston
Travel time (with gas stop) right at 4 hrs. Arrive at your destination 1200 hrs
Method 2: airline
Leave office parking lot: 0800 hrs
Arrive parking lot, Dallas Love Field 0820
Arrive terminal - 0835
Check in for flight - 0840
Flight departs - 0930
Flight arrives Houston Hobby - 1025
Procure rental car - 1045
Leave rent car lot - 1100
Arrive destination downtown - 1125 hrs
Yes, flying is less stressful....but the time savings are negligible.
If faced with a situation where a flight does NOT leave at 30 minute increments.....the prudent business traveler is just gonna say "to hell with it" and hop in his or her car and go.
But in the big scheme of things, it really doesn't matter. The so-called major carriers prevailed in this argument - they managed to get the method of taxation modified to "sock it to" WN. It resulted in a drop in short haul travel, but not egregious enough to hurt the bottom line.
