Major Announcement Concerning Charlotte Air Svc.

[mweiss]

Michael, that's assuming the airline gets 100% of the market for the city pair?

[post="248746"][/post]​

In a sense, yes. However, it's also possible to split the market by having different times of the flights.

This also assumes no local market stimulation by lowered fares...

[post="248753"][/post]​

Also true. It's a crude tool, to be sure, but it's a good starting point. Borderline markets need a secondary analysis to determine their real viability.

 

[mweiss]

Well then it would make sense that softer routes would still be viable well below your 72K threshold, if operated by equipment with a lower trip cost.

It could, provided the yields were high enough to address the reduction in amortization that results from spreading the trip cost across fewer seats. Naturally, if you push the LFs up and do a thrice-daily service with one of your aircraft, you'd be able to get as low as maybe 70K. Whether or not that constitutes "well below" is an exercise left up to the reader.

Other important factors might be an increased yield due to corporate, government, military, and academic travel between the two cities, that produces a revenue gain over normal everyday discretionary travel.

[post="248858"][/post]​

Perhaps. See, the problem we run into is that we can't take the simple O&D numbers and get good yield information from them. I could take the raw BTS 10% sample and draw better results, but it takes too long for me to do it, and chews up a good amount of computing horsepower. If it were my job, I'd do it, but this is more of a hobby for me. 😉