My Solution For Us Airways

ISP

Senior
Apr 3, 2003
321
1
I've been thinking a lot about US's problems, and this is what I've come up with:

Regardless of cost structure, this airline is screwed because of their east coast focus. It has been debated many times before, but you simply cannot have two hubs in the state of PA and be successful! Yes, the money is on the east coast, but you cannot abondon the entire west coast as well.

With the announcement of the PIT demise, here is my plan (assuming a lower cost structure is put in place):

US Air bought PSA in the late 80's to remedy the lack of west coast service problem. The only reason they struggled out west was because they started using east coast aircraft on west coast routes, and there were chronic delays. Thus, PSA was not what it once was.

Take the current PSA airlines, and send all the A/C which they currently have along with all future CRJ 200/700 deliveries to the west coast. Repaint all PSA aircraft in the former PSA color scheme (which US owns), and under the nose put a logo that says "a US Airways company." This would not be a MetroJet, seeing as it would not be "an airline within an airline." In fact, it would be a subsidary with it's own payscale, and would continue to be profitable. PSA airlines could flourish once more, and although the RJ's wouldn't be as large as former PSA equipment, they would still be profitable. I bet 50/70 seaters on former PSA routes would be VERY profitable (does RNO-SFO need mainline flights all the time). In addition, US could run an advertising campaign out west that would connect with the folks out there... something like "PSA is back" and include that smile which nobody will ever forget. In all probability, folks out west could relate more to PSA more than US even today.

Although US's codeshare partner UA serves many of these routes, it really doesn't matter because it is CODESHARE. US bought these routes for a reason back in the 80's, and darnit, go back after all these years. In addition, increase frequencies from major west coast cities to both PHL/CLT to enhance the schedule. US could at least support red-eyes (like JetBlue) from SMF/OAK/PDX/ONT/SJC. If this were done, you would have an inter-west coast route network, no chance of chronic delays (due to dedicated west coast aircraft), and a much larger customer base. If you desired to get from SEA-LAX on US metal only, you would now only have to go through SFO instead of PIT! Also, US would get all the revenue when someone wanted to go from BUR-PHL, because BUR-SFO-PHL would all be on US metal!!!

Since this scenario would pull the PSA equipment out of CLT/PHL, put the MAA planes there (as noted, PIT is gone). Additionally, send all the PIT mainline A/C to go to LGA/DCA/BOS, and the MAA A/C could go to the two east coast hubs. There are currently 107 mainline departures from PIT, and if that were balanced equally between the 3 focus cities (plus the increase in flying time), each of the focus cities could see 35-40 additional mainline flights/day and could recapture the market share they've lost to JetBlue, Song, AA.

MAA could stregthen PHL & CLT significantly. They could take over mainline routes like CLT-ILM, PHL-MHT, and then have the remaining mainline A/C focus on new Caribbean routes and the additional west coast frequencies. Bump SXM-CLT up to 4 flights/day, and then as a result you can bump CLT-SAN up to 4 flight a day as well because of connecting PAX.

For the life of me, please go back to the original plan and put 8 F/C seats in MAA A/C and label it US Airways instead of Express.

How does this plan sound?
 
Interesting, but probably too late. The US/PSA route system was not integrated very well and still only served both coasts without much in the middle. Not to mention USAir wanting to run it the USAir way.

I'm not sure that RJs, whether point to point or feeding, would help US much in the west... theres nothing to feed. With no midcontinent hub, theres no real way to connect without a million legs (say SMF-SFO-PHL-IND). They seem happy with the codeshare and really cany afford to move assets.

Sadly US is a victim of shortsightedness. Theres really nowhere for them left to move to, when the hubs were all being formed, US squandered its oppotunities in places other than the east (LAX, SAN, SFO, IND, MCI) in favor of high fare short haul east coast.

Its been 15 or so years since PSA and Piedmont. While they dont have the recognition of a Pan Am or TWA they are still remembered in thier respective regions (Allegheny too). I think US could have fostered a better public image by using some of the heritage of its acquisitions in its brands. Instead USAir and now US Airways are viewed as a generic, corporate, faceless, greedy company rather than a proud airline with a rich history.

I think alot about what US could do with its route structure, and its tricky... if only they could pick up that wonderful PIT airport and its employees and plop it down somewhere in the midwest... that way they could serve the midwest comprehensively and alot of the west.

PHL and CLT and the focus cities onlt make sense as part of a larger system... its not hard to see what an effective route system it would be combined with UAs ORD, DEN, and SFO. Management knows that the US structure, present and future is not viable as a stand alone operation.
 
Light Years,

I must ask you this:

What midwest hub does CO have (and don't tell me CLE)

What midwest hub does NW have (and don't tell me MSP - are PAX willing to go SEA-MSP-SAN?)

I think it is all about the east coast/west coast network. Of course, AA has DFW/ORD & UA has ORD so you can't include them. However DL/SLC is more west coast (is that even a hub anymore?), so they don't have a middle america hub either.

Of course, all 5 of the other majors have a much greater presence on the left coast than US...
 
ISP said:

What midwest hub does CO have (and don't tell me CLE)

>> Err, CLE -- OK, it maybe mainly RJs, but that's not dissimilar to DL's CVG


What midwest hub does NW have (and don't tell me MSP - are PAX willing to go SEA-MSP-SAN?)

>> Err, DTW is definitely Midwest

I think it is all about the east coast/west coast network. Of course, AA has DFW/ORD & UA has ORD so you can't include them. However DL/SLC is more west coast (is that even a hub anymore?), so they don't have a middle america hub either.

>> Not sure of you're point here. It's all about the coasts, but then you don't count AA and UA. Huh? IF CLE isn't a hub, SLC definitely isn't. Between ATL, DFW, and CVG, I'd say DL has middle america pretty well covered.

Of course, all 5 of the other majors have a much greater presence on the left coast than US...

>> Other than transpac NW is pretty weak on the west coast, CO only feeds its hubs from the west coast.
>> You must be drinking something funny ...
 
ALL of NW's hubs are in the midwest- DTW, MSP, and MEM, they are close together but effectively placed to serve the east, west, and south respectively. They focus on the midwest, but not solely like US does on the east.

CO has a major midcontinent hub in IAH that allows them to serve a variety of destinations (like thier RJ service to California and the east coast). This is complemented by the small CLE Express hub, which like CVG is able to support service from the upper midwest, while PIT doesnt seem to be able to. CO is US's nearest equivalent in size, but three hubs in higher O&D cities more evenly spaced (New York rather than Philly, Houston rather than Charlotte, Cleveland rather than Pittsburgh) allows them to offer a pretty impressive variety of destinations both domestically and internationally. The higher O&D cities (even though close by like EWR/PHL) allow for Transpacific, Transatlantic, and South America service US would never be able to support.

DL's operations at CVG, DFW, and SLC provide good coverage of the nation. The "other five" have done a good job in keeping a presence nationwide while US has retreated or not tried at all, figuring they'll be bought anyway.

US's east coast hubs make any new cities transcons that just dont support the traffic. There will never be a market for say, Charlotte to Spokane.

A focus city or point to point operation in California is an interesting idea. Up until about three or four years ago, US had codeshare servive with Trans States Airlines out of LAX to several CA cities like Fresno and Santa Barbara. This may have worked at one point as the codeshare was shared with several other carriers. An attempt by US alone would be similar to a start-up airline as there is little brand recognition or reason for loyalty to west coast customers (except to earn Mileage Plus miles, in which case they would use Uniteds much more comprehensive network).

But any attempt by US, particularly with high cost RJs would be torn apart by the likes of Southwest, Alaska, and America West who are well established in that part of the country,and have succeeded to an extent in American, Delta, and other retreating from much larger and lucrative markets out there.
 
I think US should take a bunch of 170s and base them in PHX and LAS and take WN on head to head.
 
700UW said:
I think US should take a bunch of 170s and base them in PHX and LAS and take WN on head to head.
...or get Mesa to do it.

;)



..oh wait, they dont have a hub in PHX.

:rolleyes: :D
 
Where do I start...

OK, first of all, the West Coast market is already extremely competitive. Try comparing fares on the majority of the north-south routes in California to what US Airways gets on flights to/from PIT, PHL, CLT, DCA, BOS, or LGA. WN's BUR-OAK fare is around $83 and they carry 10 times as many passengers as UA between BUR and SFO, who charges almost exactly twice that on average. On most intra-California routes (and to RNO) you'll compete with WN and/or UA (not to mention AA to/from SJC); to LAS or PHX with both HP and WN; to SEA and/or PDX with both US and AS (and less so WN). I don't see how exactly you compete cost-wise against WN with CRJ-200's or -700's, not to mention mainline jets on HP and AS. Nostalgia for the old PSA won't get you a heck of a lot unless the product is as good as or better than the competition and the fares are lower. The West Coast is as competitive or more so than the East, even with jetBlue, AirTran, and Southwest all expanding on the East Coast. Even jetBlue has to charge significantly less per mile on its short-haul West Coast routes (LGB-LAS/OAK) than it does on its routes to upstate NY and BTV. And how do you deal with the loyalty that West Coast travelers have to their preferred frequent flyer programs?

The only significant market with little direct low-fare competition out west is SFO -- and that just happens to be a hub for your code-share partner United. I am certain they would choose to defend their profitable routes from SFO *and* probably teminate the code-share and get US kicked out of Star if US were to try to undermine their dominance at SFO.

AA bought both AirCal and Reno Air to beef up its presence out in California and has hardly anything left to show for it, aside from small focus operations at SJC and SNA, as well as a somewhat larger operation at LAX. Delta pulled out of its north-south routes on the West Coast inherited from Western and pulled down the gateway/mini-hub at PDX.

The money simply is not there out on the West Coast. As bad as things may look back East, it's even worse out there. Why do you think WN has been adding service in the East far more quickly than out West? Because there's more money to be made in the East now.

Both CO and NW are very weak out West (aside from codeshares with AS), and Delta's SLC hub realistically competes for little north-south traffic on the coast. DEN and SLC are more geared towards east-west flying and connections to smaller markets in the Mountain West.

I do not see how you'd fill multiple daily flights to most Caribbean destinations (excluding say SJU or CUN) from CLT without dumping a LOT of cheap seats out there. The demand for travel to the islands is not unlimited, and Mexico and Hawaii have more pull as tropical destinations from west of the Mississippi. Getting from IAH to CUN takes under 2 hours, and LAX-SJD is similar. It takes less time to get to Hawaii from SAN than it does to get to SXM -- and Hawaii beats virtually anywhere in the Caribbean hands-down IMHO.
 
ISP, creative thinking, at least. But I don't think UAIR has the money to build a West Coast presence; and it would take an ability and willingness to eat a lot of losses while building up the business.

Today, anything UAIR wants to try has to be almost immediately profitable - or at least cash positive.
 
Those of you that are left remember that US Air, before Piedmont, was essentially structured as a low-cost carrier, single class cabin, etc. After Piedmont, US Air tried to be a major-- didn't work. The only way to survive is to become a low-cost carrier yourself. With your size, routes, etc., if the debt doesn't kill you, you can become a huge low-cost carrier. You and Southwest, too late to keep them out, could dominate the east coast. American and Delta are not, and never have been the companies that would put you out of business. You have to bite the bullet and use your size to limit the growth of JetBlue and AirTran while you can. Ask the guys flying for Mesa how much fun that is. You WANT to preserve what you have.
 
700UW said:
I think US should take a bunch of 170s and base them in PHX and LAS and take WN on head to head.
does the ERJ-170 have the capacity to compete head to head with SWA? I figured that if the company got the 190s it would be better suited.
 
SFB has pretty much identified the obstacles and covered the bases.

Consider a flight from Tucson to Portland.

You've got at least four different choices: Southwest, America West, Alaska, and United - at least two of which are LCCs. Bigger markets have at least five options - with American being the fifth (i.e., SAN to PDX).

With this in mind, US would literally be entering a hornet's nets of service and fares - the yields of which range from pathetic to anemic. Without any type of cohesive reach to the rest of the network, orphaning the west coast with big jets or even E-170s would be a recipie for disaster.

Such was the case with the PSA network. You essentially had two route systems - west coast and east coast with marginal connection between the two and virtually nothing in the middle.

And, folks do need to remember that on at least five occasions, airlines have attempted to enter the west coast market and have lived to regret it: 1) Republic with Hughes Air West, 2) American with AirCal, 3) USAir with PSA, 4) Delta with Western, and 5) American with Reno Air. Heck, you might even toss in Shuttle by United as another failure. Thus, its clear that many have tried (including carriers with a lot more moxy than US Airways) and most all have found that it is simply just not worth it.

If you're going to expand, you need to do it in such a manner that you #1 maximize the passenger base, #2 maximize passenger connectivity to the larger network, and #3 do so while making money at the same time. These three make a very tough trio of goals.

So, you're going to have to baby step your way out. St. Louis would have been ideal but American probably realized this and kept enough presence there to deter entrance by another hub/spoke airline.

Oklahoma City is probably too small. Omaha is too small. Chicago is overrun. Indianapolis is not far enough west and is too close to CLE, PIT, DTW, and ORD. You can't do Denver as you do not want to anger your #1 partner and have to fight a LCC at the same time (F9).

So, either you do nothing or you look at maybe two cities - COS or MCI.

COS is pretty far west, so that is going to be tough to keep connectivity to the rest of the route network. The passenger base is smallish. The fares would probably be decent neither Southwest nor JetBlue are there. The infrastructure would be tough as while there is one available terminal (the east terminal), it does not hold that many gates and would need upgrading.

MCI is somewhat out there but is not too far west. The population base is decent. The terminal definately needs upgrading to allow for any type of hub operation (those of you who have ever darkened the doors of MCI know exactly what I'm talking about). The central location allows for good connectivity. The hard hit is the largish presence of Southwest there. Your answer here would be to allow ONLY two to three fleet types to minimize costs: 1) A-319/320s for long flights), 2) ERJ-170s for most routes, and 3) DH-8s or ERJs for the short hops and small cities.
 
In today's environment, a West Coast operation will not work for all the reasons stated... and with great examples. Unfortunately, Art's plan sounds as realistic as saying, "Let's reopen the BWI hub and call it Piedmont!" Sorry Art, trying to amuse, not put-down.

ITRADE:

I think we've had this discussion before... I think COS is probably ok for a smallish focus city with reasonable fares and service to major markets only. I think WestPac's failing was they were trying to fly COS-OKC, COS-MCI, and COS-PDX. But I think there is probably room for someone to fly COS-Chicago/New York/DC/LA/San Fran for example. But I don't think there is enough local traffic on COS-OKC to make it work. Combine that with the already plethora of OKC-West-coast low-fare options, and well, I don't see it working.

MCI, however, has largely failed as a hub every time an airline tried it -- Even before a big Southwest presences. Eastern failed there. Braniff 2 failed there. US Airways failed there (In the PSA days, US Airways did have a bit of a focus city there, the relationship with Air Midwest is a testament), and Vanguard failed there. Furthermore, Midwest is hanging on at MCI by two methods: 1) sticking only to major biz markets and 2) Be the opposite of Southwest.

Unfortunately, I do not view MCI as a viable hub operation or focus city for US Airways for the above reasons. OMA might be a better option as Southwest's and Midwest's operations from OMA are much smaller than MCI, although, I suspect there is a reason for that.

I think US Airways' best shot is to be the preferred LCC at the cities on the east coast where it already has a large presence... SYR, DAY, GSO, CLT, PIT, CLT, CHS come to mind. If US Airways could become the preferred LCC from these cities to other places on the east coast, nonstop point-to-point service (instead of hub service from CLT) to points west could happen in the future. However, if this is what US Airways wanted to do, they needed to get started about 3 years ago.
 
I think it is too late now...without something like a merger...USAIRWAYS wont spend any money on major West Coast changes, right now....

My impression it will be more a streaming to point to point flights...which is really just saying..."Cutting out non-profitable stuff"...

It will probably be dropping service to alot of those low traffic smaller cities, and it has been doing that anyway for the last few years or so...Like it has at places like:
Youngstown ohio, Lancaster, PA, Baton Rouge, LA, etc.....

And with the announcement that Pittsburgh will not be a hub anymore, I suspect other Pennsylvania, Ohio & West Virginia cities have a chance to lose service like:

Bradford, Franklin, DuoBois, Latrobe, Erie, Parkersburg, Morgantown, Hagerstown, Elmira, etc...

And, I don't think that Mesa would just start a hub here to just fly those routes on their own, with limited amount of passenger traffic, without major involvement with USAIRWAYS...

I believe Mesa made a big profit last year, and I suspect that was with USAIRWAYS dollars that could have been used by USAIRWAYS flying their own planes....In fact, in a recent article in the local Phoenix newspaper Mesa gave away a brand "new" car recently to an employee who had perfect attendance for about 3 months..."Hey, where's my car? "
************************
I think the clock is ticking...It's putting alot of pressure on overly stressed workers now, ....and are still looking to the front line workers to bail the company out after 2 massive givebacks already...

They should be instead of looking at increasing revenue ... As the CWA (Communications Workers of America), demonstrated in recent graphs of employee costs,... Southwest Airlines which is a more comparable airline to USAIRWAYS in size, employees, flights than JetBlue is...

And the CWA in graphs & scales displayed that...

Southwest employee costs are higher than USAIRWAYS....


Southwest also offers benefits that USAIRWAYS doesn't offer like: thier higher pay scales, Vision benefits, Profitsharing, etc..... And they are still profitable....So, it isn't the front line employee costs a burden to the airline....

It is the other costs of trying to operate a "full service" airline on "low Fare paying customers who just wants affortable transportation...Good service, modest fares, friendly employees, and a concern for them as passengers...

It is my guess that the difference in costs are due to the higher management costs including facilities, staff and structure, to operate the airlines, between USAIRWAYS and Southwest...

That is just an opinion.... :)












(With this post..I am "not" saying that I am an employee of USAIRWAYS.....)