New fees at Southwest called ‘starting point’

I bring one carry on and one checked bag. If someone honestly needs to put 4 bags on the plane they should pay something.

Pets? Get the smelly beasts out of the cabin and in a kennel. I can't stand it.

Minors? That is a HUGE liability for any organization, so I can see that.

Corporate integrity??? The corporation's only duty is to shareholder, US government, God, and the almighty dollar.

Finally, you guys should be happy - this will probably mean a few less sacked pilots. I love Southwest, I love the songs the flight attendants sing, and I love those ugly a$$ colors!!!
 
Ladies and Gentlemen, this is what happens when your fuel hedges run out. Leave no doubt, Southwest is a very well managed airline, but their distinct cost advantage due to fuel hedges running out is over. Airline execs industry wide have been waiting for this to happen. Its well known that Southwest operations budget has been in the red for years. The fuel hedges saved them every time until now.
 
Trip7 said:
Ladies and Gentlemen, this is what happens when your fuel hedges run out. Leave no doubt, Southwest is a very well managed airline, but their distinct cost advantage due to fuel hedges running out is over. Airline execs industry wide have been waiting for this to happen. Its well known that Southwest operations budget has been in the red for years. The fuel hedges saved them every time until now.
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Isn't that because they "hedged" their fuel? IOW it gave them a base cost target and they could price accordingly, as opposed to the legacies simply underpricing all together.

For example, imagine you are running a business selling almonds. You "hedge" your almonds at a set price, say, $2/#. That allows you to budget all year knowing you will get $2/# for your nuts. You can hire employees and buy equipment accordingly.

My guess is they could've chosen to raise prices last year but didn't, because they're not in business to screw over the consumer.
 
Trip7 said:
Ladies and Gentlemen, this is what happens when your fuel hedges run out. .... The fuel hedges saved them every time until now.
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Their fuel hedges ran out about the same time that oil crashed. I'd call that perfect timing.

Fuel hedges are not some magic bullet that SWA only has and will suddenly disapear. Not having a fuel cost advantage will not throw them into a tailspin. SWA saw the 08 oil crash coming and chose not to renew any contracts (unlike UAL). If they see it climbing again, they will adjust and deal with it.

SWA off it's game slightly is still pretty darn good.
 
It's funny, I just wrote a blog about product differentiation and how it gives companies like Apple and Target a competitive advantage.

Guess it's a good thing I didn't put Southwest down as an example.

I think in an industry where your product is perceived as a commodity, when you have something that makes your product different than the others which consumers want, you've got to highlight it and maintain it.

But what do I know? I'm just a guy who says, you know, if you've got something that gives you an edge over the competition, highlight it and promote it. Don't kill it.
 
Sad to see SWA just become a another follower in the airlines instead of leader. I bet the will start charging for the LAV's too..
 
You know, I always wonder how US airlines think its okay to treat passengers the way they do. Lets say you're flying United from SFO-JFK. $50 to check 2 bags, another $50 if you want to sit in "economy plus" with what was once a normal amount of legroom, and then $12 if you want to buy a cold turkey sandwich on a 6 hour flight, as no other food is offered.

Meanwhile, you can go to Germany, hop on an LH Cityline RJ85 on a 50 minute flight, check your bags for free, and get an actual meal...in coach.

How did it get like this?
 
tonyw said:
But what do I know? I'm just a guy who says, you know, if you've got something that gives you an edge over the competition, highlight it and promote it. Don't kill it.
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You're also the guy who said start an all business class airline. Been there, done that, and they're all bankrupt! ;)
 
ChasenSFO said:
Meanwhile, you can go to Germany, hop on an LH Cityline RJ85 on a 50 minute flight, check your bags for free, and get an actual meal...in coach.

How did it get like this?
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...or in the case of Turkish Airlines and other carriers, open bar in all flights. That rocks.
 
wheelsup said:
I too wonder how Europe's airlines make it. Do they charge more? Do they have less competition?
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With the exception of maybe Allegiant and Jet America type carriers, they generally charge about the same for tickets from what I've seen, much less if you figure they don't have all those fees. And they have more competition on a lot of routes than the US airlines.
 
wheelsup said:
You're also the guy who said start an all business class airline. Been there, done that, and they're all bankrupt! ;)
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And that's different than following along with the crowd and being a lemming because why?

If I were in charge of an airline, I'd say, this is how it is. We will serve you meals on flights of over three hours. We will give you a decent amount of room, and the passenger in front of you will not be close enough for you to be arrested if she's under 18. We will take two bags of up to 50 pounds for free. We will not charge you for sodas and water.

However, you're going to pay more for this. We will charge you a fare that will allow us to make money on you, and if you don't like it, then go to another airline.

There is a very good chance the airline I would run would go belly up. But then, doing it the same way as everyone else sure seems to have the same result, so why not do it right?
 
tonyw said:
And that's different than following along with the crowd and being a lemming because why?

If I were in charge of an airline, I'd say, this is how it is. We will serve you meals on flights of over three hours. We will give you a decent amount of room, and the passenger in front of you will not be close enough for you to be arrested if she's under 18. We will take two bags of up to 50 pounds for free. We will not charge you for sodas and water.

However, you're going to pay more for this. We will charge you a fare that will allow us to make money on you, and if you don't like it, then go to another airline.

There is a very good chance the airline I would run would go belly up. But then, doing it the same way as everyone else sure seems to have the same result, so why not do it right?
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I'd say Family Airlines has some competition. Go for it!
 
tonyw said:
There is a very good chance the airline I would run would go belly up. But then, doing it the same way as everyone else sure seems to have the same result, so why not do it right?
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Maybe so but the current crop of airlines are still around, and they are not.

And if I can add, that's the weakest argument I've ever read, admitting that you'll fail quicker, so it's the right way to do it. Can I have some of what you are smoking?
 
ChasenSFO said:
How did it get like this?
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Priceline.

Orbitz.

The FAA going from a regulatory agency to one of "promoting competition"

The DOT bending over backwards for new entrants.

The American consumer wanting a Ruth's Chris steak for the price of The Sizzler.

Doofus management.

And squirrels. Squirrels are evil and will destroy us all.
 
tonyw said:
And that's different than following along with the crowd and being a lemming because why?

If I were in charge of an airline, I'd say, this is how it is. We will serve you meals on flights of over three hours. We will give you a decent amount of room, and the passenger in front of you will not be close enough for you to be arrested if she's under 18. We will take two bags of up to 50 pounds for free. We will not charge you for sodas and water.

However, you're going to pay more for this. We will charge you a fare that will allow us to make money on you, and if you don't like it, then go to another airline.

There is a very good chance the airline I would run would go belly up. But then, doing it the same way as everyone else sure seems to have the same result, so why not do it right?
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You just described Air Jamaica for the past 40+ years until now, they just started a pay for snacks program but bags remain free for now as well as drinks and such, I don't think your airline would flob if it had the right management and was not over eager to fly to every destination in the world with half filled a/c...:banghead:
 
I don't see how charging for cabin pets, unaccompanied minors and people that travel with too much crap makes them McSame.

It gives them the opportunity to generate ancillary revenue with virtually no additional operating cost. Despite how much people complain about the $15 first bag fee, the revenue increases at the airlines that have implemented them paints a different picture. I think Southwest realized they can't afford to leave a couple millski on the table anymore.
 
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