Don't you think we just have to be somewhere near SWA...I don't know what the figure would be, but we have a little different product than SWA, such as FC, more convienent connections, overseas flights, etc. I'm willing to be educated.
To add to what Jim said, part of what both East and West need to do is to get out of the market for low-yield connecting traffic. What they need to do is emphasize hub/focus city O&D along with higher-yield connecting traffic that either prefers the US product or is travelling in markets with limited LCC penetration. It's important, however, that the connecting markets remain reasonably priced, lest your passengers choose to drive to the nearest city with LCC competition instead.
It is crazy that US Airways matches fares with Southwest on certain connecting routes -- BUF-MCO, ISP-PBI, or IAH-BWI, for example -- when Southwest is flying non-stop in these markets. There is simply no way that US will make a profit by charging $59 from BUF to MCO or $49 from ISP to PBI while sending those passengers through the hubs. It does make sense to match the fares at which you can break even or make a profit.
At the same time, it's important to get rid of what some call the "Blo-Fares" -- the "oh-my-God" pricing which drove people to your competitors to begin with. PHL-BUF shouldn't be more expensive than PHL-LAX -- but the walk-up fare to BUF is nearly twice that to LAX.
Some of the company's other moves -- like going all-RJ to ATL or shifting to predominantly RJ service at IAH and DFW -- are just incomprehensible to me. Aside from the EMB-170's, the Express product isn't competitive with the mainline aircraft operated by the other airlines, leading to lower yields with higher-cost aircraft.
One other factor to consider is Express - on the West side, that CASM was almost 12 cents and on the East almost 16 cents. That's a cost that WN doesn't have, with the tradeoff being service to smaller cities that WN will probably never serve directly, resulting in higher yields from those cities (not that ATL, IAH, DFW, etc are smaller cities).
That has been one of my biggest concerns about the merged airline -- the fact that it will have 350 high-cost regional aircraft flying in its colors. How do you remain competitive against FL and B6 in a market like ROC when probably 75% of your seats (or more) are on Express? What if WN enters the market? Most East Coast markets of 250,000 to 500,000 people or above are vulnerable to LCC entry. I fear that the large regional fleet will ultimately be a liability as WN, B6, and FL continue to expand in the East. It is helpful for collecting passengers from smaller markets, but the use of regional jets in medium and large markets doesn't strike me as being sustainable long-term.
I feel that the company's international strategy has been good, since yields are generally higher, assuming the loads have been there as well.
My feeling is that US Airways as a whole will not survive if it continues business as usual in the East. Southwest getting more gates at Philly just accelerates the issue, given that US will have fewer and fewer places to keep fares high -- under the old model.
You MUST be kidding! I've got better things to do with MY time than listen/watch some swa propaganda video.
