LUV makes first move.
What will U do to defend PIT? Or will they?
http://biz.yahoo.com/prnews/050217/dath033_1.html
What will U do to defend PIT? Or will they?
http://biz.yahoo.com/prnews/050217/dath033_1.html
Southwest Pit Flights
- Thread starter Justair
- Start date
ClueByFour
Veteran
a320av8r said:
Half the places one would want to go to from PIT now require a PHL connection anyway.
LUV's not going for the connecting traffic. They are going to take a middling O/D market pair, and drive U's profit thru the floor while driving the traffic on the route way up. With the turnpike tolls being what they are, and gas being what it is, it's cheaper to fly PIT-PHL (at $80 or so R/T) than to drive.
Unlike Airtran, LUV won't be driven off the route. I'm still suprised they did it in round one.
Today in PIT US Airways once again received the Southwest Insertion!!
USA320 has nothing to say.. No post, no nothing.. Why is that?
Because he went on an interview today for jetBlue!!!
$29 to PHL on Southwest.. Lets see USA320 make a comment about that.. He
can't.. Because he knows his airline is going to get crushed in it's own backyard.
$49 to MCO!!! They are going to pack their flights..
They have two gates and are going to operate 10 flights.. We all know 10 more will come very shortly.. This region is screaming for cheap air travel.
What happens when LUV goes into CLT? Answer that magical question USA320!!
This is truly the beginning of the end.
USA320 has nothing to say.. No post, no nothing.. Why is that?
Because he went on an interview today for jetBlue!!!
$29 to PHL on Southwest.. Lets see USA320 make a comment about that.. He
can't.. Because he knows his airline is going to get crushed in it's own backyard.
$49 to MCO!!! They are going to pack their flights..
They have two gates and are going to operate 10 flights.. We all know 10 more will come very shortly.. This region is screaming for cheap air travel.
What happens when LUV goes into CLT? Answer that magical question USA320!!
This is truly the beginning of the end.
Oh no no no, don't worry, I see USA320Pilot making a post now. I bet it will say something like 'Don't worry, once the transformation plan is complete, US Airways will be able to successfully compete against Southwest on these routes with a lower CASM using E-170s that our passengers love. The additional passenger generation caused by the lower fares at PIT will be good for US Airways as it will reduce the percentage of fees US Airways will pay to the airport. US Airways can offer customers frequent flyer miles that can be used on Star Alliance airlines to redeem award travel around the world, Southwest does not. US Airways' has first class for their elite passengers to upgrade into from their $29 fares, thus losing US Airways more money, Southwest does not. US Airways offers assigned seats, Southwest does not. US Airways is Pennsylvania's airline, Southwest is not. US Airways has successfully defended its PHL-PIT turn against other carriers in the past. Seth will shortly be announcing Go-fares on these routes as part of the transformation plan, as eventually the entire system will be Go-fares and these are the first cities selected from PIT. I've seen WN employees around Pittsburgh; perhaps this could be the start of a UCT/ICT with the Dallas based carrier with US as the surviving entity? Blah Blah Blah everything is fine."
(In all seriousness, I sincerely hope US is able to exit bankruptcy and become a profitable airline)
(In all seriousness, I sincerely hope US is able to exit bankruptcy and become a profitable airline)
Justaumechanic:
US Airways' new business plan accounts for the increased competition provided by LCC's. LCC's have over 500 aircraft orders and options, which is why the company has aggressively attacked its cost structure, so the airline can finally compete with the LCC's.
As I indicated earlier and then was publicly stated by David Bronner, when US Airways fully implements its Transformation Plan the company will have a cost structure less than Southwest and AirTran.
US Airways will likely introduce GoFares in the new Southwest and AirTran markets to maintain its market share. Later this year expect GoFares to be implemented in the vast majority of the domestic network.
Justaumechanic, you're not bitter are you?
What's interesting is that management initially asked labor for $800 million in annual savings and the "give" ended up at $1.17 billion per year. Moreover, the IAM gave the greatest percentage increase over the company's "ask"...out of every other union.
These deeper cuts were required because of the union resistance to change that contributed to more passengers "booking away" from the carrier and increased bankruptcy costs.
The good news: The $317 million in additional annual labot concessions will make the company financially stronger and help provide greater profit sharing checks.
Best regards,
USA320Pilot
US Airways' new business plan accounts for the increased competition provided by LCC's. LCC's have over 500 aircraft orders and options, which is why the company has aggressively attacked its cost structure, so the airline can finally compete with the LCC's.
As I indicated earlier and then was publicly stated by David Bronner, when US Airways fully implements its Transformation Plan the company will have a cost structure less than Southwest and AirTran.
US Airways will likely introduce GoFares in the new Southwest and AirTran markets to maintain its market share. Later this year expect GoFares to be implemented in the vast majority of the domestic network.
Justaumechanic, you're not bitter are you?
What's interesting is that management initially asked labor for $800 million in annual savings and the "give" ended up at $1.17 billion per year. Moreover, the IAM gave the greatest percentage increase over the company's "ask"...out of every other union.
These deeper cuts were required because of the union resistance to change that contributed to more passengers "booking away" from the carrier and increased bankruptcy costs.
The good news: The $317 million in additional annual labot concessions will make the company financially stronger and help provide greater profit sharing checks.
Best regards,
USA320Pilot
robbedagain
Veteran
alright if USAIR went ahead and put say either the 757 and/or 767s only on the pit mco run with the go fares, would it be making more money than swa and this is with all the lowered labor cost and lets just say if the oil prices were at either 30 or 40 bucka barrel?
people, $29 fares are available on approximately 5% of flights, US is actually cheaper in many markets where it competes head to head with SWA. The real benefit to PIT won't be $29 fares, it will be that the walk up fare PIT-PHL will be $299, as opposed to $1650.
ClueByFour
Veteran
USA320Pilot said:
That assumes that US makes it until like 2007 and that additional aircraft are ordered, and such. That's 2+ years off. US will not have lower costs that LUV when love begins PIT service. That projection probably also includes $35/bbl oil, and meaningful nonlabor savings (neither of which have shown any tangible signs at all of actually coming to fruition).
The problem is that US cannot currently make money at those rates. But let's forget that--the question one should ask is "why has US charged fares on these routes for years that is anywhere between 2 and 20 times the actual CASM on the route?" (lack of strategic vision and customer focus on CCY's part is the answer, BTW).
That's going to be interesting, and probably will not happen. It can't. US has too many ultra-high-CASM RJs and pay-for-departure contracts to do it.
Well, look at the roundtrip fares US is offering for PIT-PHL after the SWA announcement!
$58
$78
$98
$98
$128
$136
$158
$58
$78
$98
$98
$128
$136
$158
BoeingBoy
Veteran
- Nov 9, 2003
- 16,512
- 5,865
The PIT-PHL market is one of the higher fare markets out of PIT - the average fare paid on US was $273 in 3Q04 with 19% of passengers paying $326 to $350 and 1% paying over $450.
In 3Q04 there was an average of 422 total passengers per day on this route. Looking at PHL markets of similiar distance both before and after WN's entrance (PHL-MHT, PHL-PVD, & PHL-RDU), traffic went up 1012%, 1002%, and 264% respectfully, while fares dropped 82%, 81%, and 72% respectfully.
Interestingly, the increased traffic more than offset the reduction in fares, with PHL-MHT & PVD total revenues more than doubling. Unfortunately, just like these markets, we will now share that revenue with WN.
Jim
In 3Q04 there was an average of 422 total passengers per day on this route. Looking at PHL markets of similiar distance both before and after WN's entrance (PHL-MHT, PHL-PVD, & PHL-RDU), traffic went up 1012%, 1002%, and 264% respectfully, while fares dropped 82%, 81%, and 72% respectfully.
Interestingly, the increased traffic more than offset the reduction in fares, with PHL-MHT & PVD total revenues more than doubling. Unfortunately, just like these markets, we will now share that revenue with WN.
Jim
Jim,
Are those PAX/day numbers all revenue passengers? Seems like you might have 300 US employees alone commuting PIT-PHL on any given day!
I guess this could be seen as a good commuting option for US Pilots/.
Are those PAX/day numbers all revenue passengers? Seems like you might have 300 US employees alone commuting PIT-PHL on any given day!
I guess this could be seen as a good commuting option for US Pilots/.
