Spirit rolls on
- Thread starter Kingairer
- Start date
scooter2525
Very well Member
I doubt YOU will be there if/when they merge.
scooter2525
Very well Member
LOL k I'll try this a different way.
You said "Spirit and Frontier merging though...I would be on it."
I would be on it, like "I will be on that merger when it happens."
But you probably won't be working for Frontier or Spirit if that happens. It was a joke at the typo.
I agree that it probably will happen.
Ecl!pse
Well-Known Member
I could certainly be wrong, but I think if DL were to go after Spirit and Frontier like Alaska, it would have happened already (almost instantaneously, i.e. dumping capacity in to combat this). It could still be coming, but given this is ATL we are talking about, I would expect DL to have a "playbook" on how to respond instantaneously to major capacity disruptions. At 1x daily, these flights aren't really enough to "hurt" Delta - they are already choosing to "reject" the large majority of these passengers in favor of connecting passengers anyways. The cabin rebranding is merely a cute way to sell the last 15-20% of seats that are flying around empty today, and to boot it helps combat some of these ULCC markets.
That being said, as Spirit and Frontier gain scale, and these onesie/twosie markets become 4-6x daily, there will be a real problem (see: Europe and Asia right now). That is why it is key for the big players (AA, DL, UA, WN, B6, VX) to contain and continue improving unit costs moving forward - that's by far the most effective competitive tool in the chest. DL is lightyears ahead of all but the ULCC's in executing this right now.
killbilly
Vocals, Lyrics, Triangle, Washboard, Kittens
Their full-fare-class tickets cost less than full fares on other airlines - not always, but usually, in my experience. The reason that you don't generally see SWA as the lowest fare is because their "standard" or "discounted" fares are much closer in price to the deeply discounted fares on other airlines. Or someone is comparing SWAs full-fare to a discounted legacy fare. You have to compare apples-to-apples.
I don't fly as much as I used to, but that was the situation back then.
kellwolf
Piece of Trash
Nah. A lot of times I just do a website "cheapest" comparison. Don't have to doctor the stats. SWA cheapest is normally right up there or more than everyone else unless there's a fare sale. Then you have to be one of the first 15-20 people to hop on it or all the seats at that price are gone.
wheelsup
Well-Known Member
The key to the legacies survival will be maintaining cheap regional feed. Example, State College, PA to San Diego, CA. No ULCC will generally ever have the route structure needed to operate that pairing. However there is a need out of that city, actually a fairly large international connection believe it or not, that requires the use of small commuters operated as cheaply as possible to connect to a hub.
As the legacies expand and use larger aircraft in markets and cut down on frequency, they suddenly become targets for ULCC's entering.
US Airways threw RJ's on the SWA routes to keep their yields down, which resulted in SWA actually pulling out of markets (PHL-RDU, PHL-PIT for example).
Provided they can staff their regionals and still operate them cost effectively, the next step is increasing the quality of service on the high end. The carrier that can attract the most whales is going to keep going and be able to compete, the one that just operates as medicore as required is going to get beaten at the high end and low end, and slowly wither and die (AA if they don't shape up, also possibly UAL).
Ecl!pse
Well-Known Member
The Southwest experiment in PIT-PHL was a challenge from the onset. While Southwest qualifies as an LCC, they aren't a ULCC -- they are much more susceptible to competitive capacity increases than a ULCC. It wasn't necessarily the RJs that ran Southwest out of the market, it was the gross overcapacity in the market (US was still flying a 757, a 767, and multiple 737/A320 trips each day), coupled with the fact that US had a huge point-of-sale advantage in both cities with the large frequent flyer base. In essence - US had the capacity and connectivity in place to always swamp Southwest's local fares (to unsustainable levels for both carriers), and even on an equal fare basis, Southwest couldn't steal local traffic from US because of the FF base. Both carriers certainly lost money, but someone had to blink - and ultimately it was Southwest. This is the same reason why the VX PHL-SFO/LAX markets didn't work, and the same reason why I believe DAL-AUS won't work. Their cost structure isn't low enough to be profitable from the pending fare/capacity cesspool, and they don't have enough of a presence in either city to steal traffic at the same fares.
The ULCC dynamic is now a little different because they can sustain lower base fares, and they aren't so reliant on the base fares to be profitable -- almost 50% of their revenue come from ancillaries. So when carriers dump capacity on ULCC's, it compresses fares a bit, similar to the Southwest PIT-PHL example above - but they have the cost structure to support continually walking the base fares down to staggering levels, and they also have the lever of other income sources to make up the difference. If the likes of Spirit/Frontier continue to grow, and continue to seek domestic opportunities, the bigger of these "feeder" markets will eventually be flown by them.
PS - SCE-SAN is a 7 person per day market -- I don't think they're moving any needles
. In a crunch, the legacies would drop that market and recapture most of the revenue over PIT/PHL anyway.
Ecl!pse
Well-Known Member
Yep - it folded because they couldn't compete with US and get enough revenue customers. I don't think the non-rev thing played any factor.