Wrong time to jump on Southwest?

[LoneStarMike]

Thursday, August 22, 2002
STREET WISE
The Wrong Time to Jump on Southwest?
Though the discount airline is way better off than the big carriers, several factors could stifle the stock for a while
By Amy Tsao
Business Week
I don''t know whether or not I agree with the article. I guess it would depend on what happens at the other airlines. I would be interested in hearing other''s opinions.
LoneStarMike

 

[wannabe CRJ driver]

When will people relize that SWA & JBLU are two different airlines with two totally different operating principles. If JBLU wants to go take on AA & UA let them. I'm sorry that we aren't expanding fast enough for your taste but for the 33,000 employees here at SWA will tell you......We would rather be a small airline than a dead one. Personally I would luv to see us go into DAY,COS,MKE,PIT,ANC,SJU,BDA,ATL...and maybe buying Aloha to get their Hawaiian network...I think that would be a great idea as we operate similar fleets.But I also know that this will be a long time coming!

 

[AirplaneFan]

I would never call SW airlines stock "widows and old ladies stock". Airlines stocks have a lot of inherent risk.

I do think that SW might be losing its edge. They should be more aggressively expanding. They should be going to Richmond, Dayton and a city in South Carolina before the middle of 2003. I am very glad for JetBlue putting competitive pressure on SW, perhaps more pressure since UAL started the shuttle in early 1990's. The best moves SW has made this year have been the non-stops from MDW to the West Coast. Other than that the flight increases have been timid. While JB has the guts to fly JFK-SJU going head-to-head with AA and has a battle with UAL and AA from their hub airports, SW keeps adding Florida flights.

 

[AirplaneFan]

JBLU and SW are similar in many ways, different in a few. IMHO, JBLU has an improved product over SW right now, but there is no guarantee that it would be able to maintain the success as long as SW has.

JBLU competes against UAL and AA because they are the weaker competition. JBLU is only competing against SW on LGB - OAK and LGB - LAS to hold slots. JBLU will eventually move the planes off most of those routes. I also would not be surprised if JBLU buys the slots from AWA.

My points on the lack of growth of SW is that JBLU is adding more planes than SW this year. JBLU is essentially an airline that was established because of missed SW opportunities. But its all MHO.

 

[Farley]

I'm not sure that SWA could have captured all of the opportunities out there. That is why we have Jetblue, Airtran, Frontier, and all the others trying to offer a low fare alternative. Southwest definitely has proven itself to be a long term winner, and that says a lot.

 

[WNjetdoc]

Good points being made on this thread. I have heard rumors about WN doing something big AFTER the AMTs and perhaps the f/a's contracts are complete. I am somewhat frustrated about the lack of capitalizing on the opportunities out there. I know we grow slow and smart but there are some growth possibilities, IMO.

 

[Tango-Bravo]

[blockquote]
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On 8/25/2002 3:33:05 PM wannabe CRJ driver wrote:

......We would rather be a small airline than a dead one.
----------------
[/blockquote]

Excellent point. Among the leading factors contributing to the malaise of the largest U.S. airlines IMO is their unwieldy size. They have grown beyond their ability to be managed efficiently and effectively.

IMO Southwest may be reaching the point where they are pushing the envelope in terms of outgrowing their ability to sustain their winning game plan.

 

[swflyer]

One thing not posted here, that I posted on the black hole that is the Yahoo board , was the constraint SWA must have felt waiting out the Contract vote at Boeing. Doesn't do any good to announce service if your plane supplier is not making planes.

Now that there's been a no vote on striking, and although most felt the offer was substandard, Boeing knows they can meet delivery schedules, offering SWA a chance to shine in '03.

I, too, am VERY ready for some growth. I'm rather addicted to good news and we need to absorb our HUGE flight attendant group.

 

[ALSF 2]

I personally think that SWA has been doing the right thing over the last year! They haven't been growing like mad during the biggest disaster to ever hit the airline industry? Boo hoo. They have been keeping the cash on hand, the one thing that keeps airlines alive! They will grow... when it is safe to. The company has been expanding for the last 30 years, I think they know what they are doing and can take a break for a second.

Also, what is this comparision between SWA and JetBlue?? Yes, they have somewhat similar business models, but really.... It going to take a long time for JB to compare to the success that SWA has created. Someone in a eariler post mentioned that JB will be taking on more aircraft than SWA this year. Who cares... How many A/C does JB have? 30? Is JB even considered a National Carrier? I'm not meaning to rip on JB, but people talk like it's one of the top 10 majors. It's not even a speck compared to the size, scope or industry changing culture that SWA has brought to the airline industry!! JMHO!

Cheers