I know that this goes in the WN forum but wondered how we will compete with these $29 fares. :unsure: There is an interesting comparison of the walk-up and advance purchase fares.
Press Release
Press Release
Wn Phl Fares -merged topics
- Thread starter A319FA
- Start date
A couple of things. How many flights a day on WN vs US right now? We match their fares on the flights that are in direct competition with WN (similar times). Let WN fill the plane at $29. After their 137 seats are gone, whats left? This is where I hope we dont start offering the same thing on ALL flights (but we probably will to compete). Just match them on the flights at the same time, otherwise if they only have a 10am flight, why match it on our 6pm flight? They should be two different choices.
The fare I see advance purchase TPA-PHL is already what we're offering in the market. The major differences I see are the walk up fares. Remember those are the ones management keeps saying arent there anyway. I think we do need to do the fare overhaul systemwide on these fares (actually all of them), but you need to remember there are really three types of fares. First Class, Walkup, and everything else. WN doesnt have FC and we already match (or beat) WN on many of the everything else category so its the walkups that is the big hit. But from looking at the press release it looks like EVERYONE who flies WN will be saving 80-90% over what they're paying now, which I can guarantee you from working some PHL flights, isnt the case. But they do have a good PR machine.
Now that the cat is out of the bag, lets see the response.
The fare I see advance purchase TPA-PHL is already what we're offering in the market. The major differences I see are the walk up fares. Remember those are the ones management keeps saying arent there anyway. I think we do need to do the fare overhaul systemwide on these fares (actually all of them), but you need to remember there are really three types of fares. First Class, Walkup, and everything else. WN doesnt have FC and we already match (or beat) WN on many of the everything else category so its the walkups that is the big hit. But from looking at the press release it looks like EVERYONE who flies WN will be saving 80-90% over what they're paying now, which I can guarantee you from working some PHL flights, isnt the case. But they do have a good PR machine.
Now that the cat is out of the bag, lets see the response.
TADJR
I agree with you that US and WN are two different types of carriers. But, I must disagree with you on the other thoughts - The Southwest effect is dramatic, I have seen it work in Chicago and Washington. Southwest will have the low fares and US won't be able to do this for years on years. The Southwest fares levels will effect US on a nationwide basis matched up to the Southwest system.
BTW - I like your airplane logo with all the colors of current and past carriers.
I agree with you that US and WN are two different types of carriers. But, I must disagree with you on the other thoughts - The Southwest effect is dramatic, I have seen it work in Chicago and Washington. Southwest will have the low fares and US won't be able to do this for years on years. The Southwest fares levels will effect US on a nationwide basis matched up to the Southwest system.
BTW - I like your airplane logo with all the colors of current and past carriers.
The fares that US had and people paid between PHL-PVD were insane. I flew that route only 4/5 times and drove it 3 times. People were paying those fares because when I tried to go, all the "cheap" seats were gone, so I would drive. I am driving it in a couple of days because it was showing on the US website that all flights were sold out. This $29/$49 one-way fare by SWA will certainly erode the yeild for US in the PHL-PVD market, if they match the fares. Just my 2 cents out loud....
Yea, some folks on the SW boards were asking about any fares being posted. I think from what I read, they just posted fares out of PHL today. One being $79 one-way to FFL. 
Once again, its hard to compare WN to anyone since they operate in such different styles. I think most everyone here at one time or another has said they agree the overall fare structure must change and there is no comparison right now for US vs WN walkup fares, those are going to have to change one way or another. My main point is on the "everybody else" fares.
Currently US operates 8 flights a day from 6am until 840pm TPA-PHL. In May, WN starts 1 flight at 1025am. Should US match WN fares on the 6am flight and the 840pm flight or just the flights that blanket the WN flight at 1025am? Even if we drop the walkup fares to a two tier walkup system (definitely not close to what it is now), but one that matches WN on the two flights closest to their 1 flight and then another fare for all the rest. I know the product is air transportation TPA-PHL, but there should be a differentiation between the flights at 6am, 1030am and a 5pm flight. Same as early bird specials or a matinee at the movies. This is where I hope we dont just say everythings the same price. You need to compete with WN, so compete with them at their times, but the rest of the times you should have a little leeway. And once again, once the 137 seats on WN are gone, then what? With PHL being a hub for us, we're not totally reliant on selling the entire plane at the cheapest PHL fare available. I just hope the plan isnt to blanket sell everything on the cheap because we all know that wont work against WN. There should be room to compete with a little smart inventory management thrown in there.
Currently US operates 8 flights a day from 6am until 840pm TPA-PHL. In May, WN starts 1 flight at 1025am. Should US match WN fares on the 6am flight and the 840pm flight or just the flights that blanket the WN flight at 1025am? Even if we drop the walkup fares to a two tier walkup system (definitely not close to what it is now), but one that matches WN on the two flights closest to their 1 flight and then another fare for all the rest. I know the product is air transportation TPA-PHL, but there should be a differentiation between the flights at 6am, 1030am and a 5pm flight. Same as early bird specials or a matinee at the movies. This is where I hope we dont just say everythings the same price. You need to compete with WN, so compete with them at their times, but the rest of the times you should have a little leeway. And once again, once the 137 seats on WN are gone, then what? With PHL being a hub for us, we're not totally reliant on selling the entire plane at the cheapest PHL fare available. I just hope the plan isnt to blanket sell everything on the cheap because we all know that wont work against WN. There should be room to compete with a little smart inventory management thrown in there.
Anyone see another difference here?ktflyhome said:Yea, some folks on the SW boards were asking about any fares being posted. I think from what I read, they just posted fares out of PHL today. One being $79 one-way to FFL.
US fares PHL-FLL
Roundtrip Price in US$ Fare Rules
$184
$184
$254
$278
$298
$309
$309
$338
$349
$349
$354
$401
$441
$464
$540
WN Fares PHL-FLL (One way)
$79
$129
$133
$195
BoeingBoy
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tadjr,
If WN was going to stay with just the 14 flights a day, that would make sense. I doubt that will be the case. In saying that potential passengers will have to fly us when WN is sold out, you're "training" people to call WN first - only when they're sold out will they call us. As WN adds more flights, less people will have to call us.
As far as us offering a matching fare now, how many seats do we offer at that "loss leader" fare? Currently, those that can't grab one of those "cheap" tickets end up paying a little more. What happens to our average yield when we have to offer more and more seats at that low price?
Jim
If WN was going to stay with just the 14 flights a day, that would make sense. I doubt that will be the case. In saying that potential passengers will have to fly us when WN is sold out, you're "training" people to call WN first - only when they're sold out will they call us. As WN adds more flights, less people will have to call us.
As far as us offering a matching fare now, how many seats do we offer at that "loss leader" fare? Currently, those that can't grab one of those "cheap" tickets end up paying a little more. What happens to our average yield when we have to offer more and more seats at that low price?
Jim
Do low-fare carriers really have the best fares?
Discount carriers have won legions of fans by touting their savings, but they may not actually always have the lowest fares. In his Fare Guy column in The Charlotte Observer (free registration), Ted Reed cites a study by consulting firm Unisys R2A that shows discount king Southwest regularly charges more than US Airways in some markets. The report covers fares in markets where both airlines offer non-stop or one-stop service. In short-haul markets (up to about 700 miles), "Southwest is generally able to charge slightly higher average fares," it says. For instance, Las Vegas-Orlando standard fare with no Saturday-night stay requirement was $260 on US Airways and $318 on Southwest. JetBlue spokesman Todd Burke said that low-fare airlines such as JetBlue are initially able to attract customers with low fares and other amenities, but are able to keep them because of good customer service. "Even if in a particular circumstance (our fares) are higher, people fly with us because we treat them like human beings," he said. Posted 7:30 a.m. ET
Link
Discount carriers have won legions of fans by touting their savings, but they may not actually always have the lowest fares. In his Fare Guy column in The Charlotte Observer (free registration), Ted Reed cites a study by consulting firm Unisys R2A that shows discount king Southwest regularly charges more than US Airways in some markets. The report covers fares in markets where both airlines offer non-stop or one-stop service. In short-haul markets (up to about 700 miles), "Southwest is generally able to charge slightly higher average fares," it says. For instance, Las Vegas-Orlando standard fare with no Saturday-night stay requirement was $260 on US Airways and $318 on Southwest. JetBlue spokesman Todd Burke said that low-fare airlines such as JetBlue are initially able to attract customers with low fares and other amenities, but are able to keep them because of good customer service. "Even if in a particular circumstance (our fares) are higher, people fly with us because we treat them like human beings," he said. Posted 7:30 a.m. ET
Link
KCFlyer
Veteran
I just checked both websites to compare something. PHL-PVD one way, the most you will pay on Southwest is $89. The one way fare on US was $417.10.
Southwest is for me its cheaper then if i went nonrev no hassle fromthe agents ,no wait to see if i have a seat,just give them the the ticket and have a seat ,i love it hassle free.
It's ALL about perceptions, and that is one of the rasons why the bigs MUST learn to create a differintiated product that has a "perception" of value. We beat this subjest up about a year ago, but at the time a "brainiac" from Booz-allen claimed his employees save the company a couple grand a trip by making them get up early, and drive to BWI and sit through up to a 4 leg day to arive "fresh" for meetings in the bay area. Problem is, on that DAY a walk up, unrestricted fare on UAL from IAD to OAK NON-STOP was CHEAPER than SWA and came with more room and a meal. But the PERCEPTION is that SWA is the cheapest.
Less than 20% of Americans have high speed access. Do you REALLY have time to go to each and every airline site looking for the cheapest fare with dial up access? NO!!!!! SWA banks on you ASSUMING they have the cheapest fare and that you won't bother going to Orbitz, ect. They don't WANT a head to head comparison. I recently bought a ticket (something I swore I'd never do again...), and the two cheapest tickets were on DAL and UAL with Air Tran being $50 more expensive. AT was likely banking on the ONE phone call or the ONE internet visit. All three tickets were reasonably priced (with the UAL and DAL tickets being cheaper than they should have been for an unrestricted walk up fare). They depend on folks calling them and going "$250, that's probably the cheapest I'll find, OK book me"
Less than 20% of Americans have high speed access. Do you REALLY have time to go to each and every airline site looking for the cheapest fare with dial up access? NO!!!!! SWA banks on you ASSUMING they have the cheapest fare and that you won't bother going to Orbitz, ect. They don't WANT a head to head comparison. I recently bought a ticket (something I swore I'd never do again...), and the two cheapest tickets were on DAL and UAL with Air Tran being $50 more expensive. AT was likely banking on the ONE phone call or the ONE internet visit. All three tickets were reasonably priced (with the UAL and DAL tickets being cheaper than they should have been for an unrestricted walk up fare). They depend on folks calling them and going "$250, that's probably the cheapest I'll find, OK book me"
ringmaruf
Veteran
If a tree falls in the forest and no one hears it, does it really make a sound?
Planeloads of people will book WN PHL-PVD and rent a car and drive to Boston, not knowing that US offers fares that are just as cheap on PHL-BOS. (And US will match the PVD fares too, if that's where you want to go.)
ALL of the markets WN is entering right now ALREADY HAVE LOW FARES. But people will all flock to WN and credit WN with lowering the fares. Perception is reality.
Planeloads of people will book WN PHL-PVD and rent a car and drive to Boston, not knowing that US offers fares that are just as cheap on PHL-BOS. (And US will match the PVD fares too, if that's where you want to go.)
ALL of the markets WN is entering right now ALREADY HAVE LOW FARES. But people will all flock to WN and credit WN with lowering the fares. Perception is reality.
KCFlyer
Veteran
I did a little investigating. The prices they quote are one way fares. The Southwest fare is fully refundable and changeable. The US fare is nonrefundable and subject to a minimum of a $100 change fee. So...if one makes a change - the US fare jumps to $360 ($100 change fee applied). That fare is also involving a change in PIT to an RJ. That fare also leaves Las Vegas at 11:30 p.m. and arrives in Orlando at 3:43 p.m....a travel time of 13 hours. If you want the nonstop, it's $355 - still non refundable and still subject to the $100 change fee. Of course - consultants rarely take into account something known as convenience. The "apples to apples" (fully refundable) fare on US is $1,067 one way.orwell said:
BoeingBoy
Veteran
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orwell,
I agree with the perception issue that some have mentioned. As far as lower fares than southwest, you have to be careful with statistics (which most reporters are not).
For instance, the LAS - MCO fare. Is that non-stop on both carriers (apples to apples)? Airlines traditionally charge less when their service on a route requires a connection while their competition has non-stop.
Likewise, "average" fares can be misleading. What percentage of WN passengers pay the walk-up fare compared to us? It the difference high enough to bring WN's "average" above ours?
Jim
I agree with the perception issue that some have mentioned. As far as lower fares than southwest, you have to be careful with statistics (which most reporters are not).
For instance, the LAS - MCO fare. Is that non-stop on both carriers (apples to apples)? Airlines traditionally charge less when their service on a route requires a connection while their competition has non-stop.
Likewise, "average" fares can be misleading. What percentage of WN passengers pay the walk-up fare compared to us? It the difference high enough to bring WN's "average" above ours?
Jim
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