Low *Prices* for a High *Cost* Service?

derg

derg

Apparently a "terse" writer
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Virgin America loses $34.8 million in first quarter of operations.
Tuesday December 18, 2007

Virgin America lost $34.8 million during the third quarter, its first full quarter of operation, according to statistics released by the US Dept. of Transportation and cited by Dow Jones. Operating revenues totaled $16.2 million against $51.6 million in expenses.
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Woooo Hoooo A profit margin of -210%

roxrs!!!111! .... whatever that means.

Good job pissing away money Branson (we all know who runs the show;))
 
Ehh, no worries. The rest of the Virgin network is helping finance Virgin America so he'll be alright... Erosion of cabotage laws is good, no? :)

Perhaps we could start a Southernjets UK or something.
 
This got me thinking.

I paid $257 and change for a full-fare ticket on SWA yesterday from DAL to SAT and back. I was wondering what that seat cost SWA to fly me there - 36 minutes in cruise either way at FL290.

I was just wondering how profitable that flight was. It WAS a full flight, and I doubt everyone paid what I did for it.
 
Yeah, if they didn't have the financial support and it was their 3rd or 4th straight quarter with a loss like that, it'd probably be different.
 
killbilly said:
This got me thinking.

I paid $257 and change for a full-fare ticket on SWA yesterday from DAL to SAT and back. I was wondering what that seat cost SWA to fly me there - 36 minutes in cruise either way at FL290.

I was just wondering how profitable that flight was. It WAS a full flight, and I doubt everyone paid what I did for it.
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SWA is a different animal - they're entire business model revolves around their low prices.

Remember - they've gone over 30 years without losing money. ;)
 
Sorry. Hate to be the grammar police, but we're all professionals here.

"they're entire business model revolves around their low prices."

they're - A contraction of THEY ARE

their - posessive
 
Raising prices is only one piece of the puzzle. The industry still has an overcapacity problem. Park some RJ's and cut frequencies perhaps? I doubt Virgin America will be profitable anytime soon.
 
I have a ticket in mid-January for SAT-ATL on main-line AA...$308 w/taxes. Doesn't seem like a lot of profit there either.
 
But but but, consolidation will solve the overcapacity problem! I...I saw it on the telly!

It'll magically make that 100$/barrel oil disappear!
 
PCL_128 said:
There is no overcapacity problem in US aviation! Airlines are still bringing in record load factors. The overcapacity idea is a myth.
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I think there would be overcapacity if the airlines charged for consumers to cover their expenses. Right now they put butts in seats regardless of what fare it takes.
 
I doubt it, because it would still be far cheaper to fly than to drive. Most airlines are already turning a profit anyway, so expenses are covered at this point.
 
PCL_128 said:
The overcapacity idea is a myth.
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True that! My wife and I almost had to rent a car to drive from Indiana to Colorado this summer on a random weekend visit! We still had to end up renting another car and driving to STL to get a flight to DEN! And we got the last 2 of out 3 seats left on the plane :banghead:
 
Say all you want about Virgin Atlantic/America, but my god their flight attendants are HOT.
 
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