Originally Posted by
Bucking Bar
Sort of ... .
- Legacy carriers and Southwest have shown remarkable capacity discipline. This has driven prices up. It is a temporary gain to be sure. Nature abhors a vacuum and carriers like Spirit will grow to fill it as quickly as they can. Our action (including AA and United) might even save Virgin America.
- We don't own the RJ's. As capacity has shrunk it has forced Delta's partners into losses. The 50 seaters can not be re-deployed outside a network and remain profitable. They have to come up with a "plan B."
- Plan B is probably going to be high performance turboprops, which are not currently constrained by our scope. Bombardier will gladly resupply the market. The Q-400 has great operating numbers, but allegedly passengers don't like it. It's other problem is it's 737-800 sized footprint which makes it a bit of an elephant at a ramp developed for 50 seat RJ's. (ALPA is aware and I expect turboprop scope to be a part of C2012)
We need a competitive small jet that
we fly.
The profit is also being helped out in a big way by all of the fees that we are charging for everything. They are not taxed and go right to the bottom line. Shrinking my not be making the money, but the way the price structure of the services is now being used.