[STRONG]You and everyone else need to stop the Southwest comparisons. They are an enigma in this business. If every airline adopted their exact same strategy and cost level, they still wouldn't come close to WN's level of success. WN has the lowest cost structure of anyone. Don't you think that allows them to undercut everyone else and still make money? Of course it does. Without the cost structure to make it work, it doesn't work.[BR][BR][/STRONG]Again, I am not saying to clone Southwest. But in the market today, price is playing a much bigger role in corporate travel decisions. What I (and Tom Bascom) are saying is that you don't have to match LUV's fares. But U really should do something to attempt to increase the number of people on their planes who are NOT buying a loss leader ticket.[BR][BR][STRONG]Would WN like to charge higher fares and make more money? I'm sure they would. But why should they? [BR][BR][/STRONG]You miss my point...you're quite correct that they would like to charge higher fares and make more money. But they found that even with their relatively low walk up fares, they were not getting as many passengers as they needed. So they lowered their fares to $299 one way in an effort to stimulate demand in a down period. It is working for them. When the economy picks up, I am quite sure that you'll see them raise those last minute fares again. The thing is, they'll still be affordable[BR][BR][STRONG]But cheaper fares are not the secret of their success. In fact, you can find many instances where WN does not offer the lowest fare in the market. But WN's brand is so strong that they will always be thought to have the lowest fare. [BR][BR][/STRONG]This is the leisure traveller must save us mentality that is killing the major carriers. Sure enough everybody thinks of SWA as the low fare carrier. You admittedly can't match their costs, so why in the hell are you offering fares that undercut SWA advance purchase fares? Do you want to let the public know that you can be just as affordable? And you are...to the vacationing leisure traveller who cannot save your industry. You may not be able to match the cost structure of SWA, but go look at their website and look at what the other airlines should be doing....go into reservations, pick two cities and see what you are presented with...4 or 5 fares, and the avialabilty of those fares. Simple. Look at their restrictions...stay over one night. Non refundable. But... no chnage fees. No use it or lose it penalties. Now try booking a trip on U or UAL or AA. Look at the restrictions...even on some last minute fares. Think theres any room to shave something off those fares...enough that just might encourage a businessman to fly you? [BR][BR][STRONG]Their success comes from their efficiency of operations and their corporate culture. The dysfunction that is ripe within the rest of the airlines makes it nearly impossible for other airlines to adopt that strategy and succeed. It's more than fares. Simply offering WN style fares won't solve the problem. I agree that fare changes are necessary. The whole structure is ridiculous these days. But either you get the entire industry to go along at the same time (which won't happen), or you must take baby steps to get to that point.[BR][BR][/STRONG]Again, don't clone SWA. But look at this scenario - U doesn't compete with AWA...you say you have to get the entire industry to go along...poppy****...to use the Nike phrase - [STRONG]Just Do It[/STRONG]. U could restructure their fares in the same way HP restructured theirs. If the others don't want to follow, then laugh all the way to the bank as they try to continure luring money losing leisure travellers with fare sales while you draw in business flyers who are making you a PROFIT. HP is still showing a loss...but they have seen their loss decrease under their new scheme. U doesn't have to become a low fare carrier, just a business friendly carrier. IMHO, if that doesn't force the industry to change, then the benefit will go to U (or the first airline with cajones enough to try it). [BR][BR][STRONG]Sure you can reduce fares. But to what level? If you simply don't buy the argument, than do the math with the CASM, RASM and yield numbers and you'll see what a disadvantage US is at in this environment with their CASM still hovering around 11 cents. Not willing to take a cut in yields? Have you tracked yields in the industry over the last two years? Yields are misleading. Unit Revenue is the better indicator of an airline's revenue performance.[BR][BR][/STRONG]What level? How about half for starters? Take the highest unrestricted fare on a U route and cut it in half. Set up 4 other fare levels under that, and worst case, make the most advance purchase fare bucket break even. Drop the change fees. Drop the penalties. Drop the use it or lose it. Allow standby. Become the business travellers airline. U could offer highly competitive advance fares (maybe not the lowest, but a good ad campaign showing the benefits of paying a few dollars more might not be too bad) and highly affordable last minute fares. Price them by segment (like SWA or Airtran). If someone buys a ticket in the forth fare bucket and changes their departure date on the outbound within 7 days, upcharge that segment to the available fare bucket, without assessing a change fee. [BR][BR][STRONG]But I wholeheartedly agree with you that fare structures must change. But you cannot change them overnight unless you enjoy a cost advantage over other carriers. They will simply CMI you to death.[BR][BR][/STRONG]I disagree with this...you can restructure them to work under your current cost structure...maybe not $299 one way, but certainly less than what you currently have. This should be something that is done in tandem with cost cuts. [BR][BR]I don't know why I'm so adamant about this...I'm about the biggest SWA fan there is. What I propose could actually hurt SWA. But you guys want to out-Southwest them on advance purchase fares, and as long as you do that, I can only sit back and watch SWA enjoy even greater success. Restructuring fares might entice the elites you crave to actually fly you at a profit. As it is, the ones that do travel are doing it with your loss leader fares. Helluva way to run a business.
