Business model has a lot to do with it. Price per bag is the same for a FLL-LAX and a FLL-TPA flight. At ancillary revenue at 40% yes indeed shorter flights are the way to go. They have talked about adjusting fees for segment length. It has not happened yet.
It really does not. The take rates for ancillaries along with the average fare when you look at systemwide O&Ds varies greatly based on a number of factors with distance being in the #1 spot when you average out market anomalies. Secondly, We've been doing distance based pricing on fees for a while now on a limited basis. BFS anyone?
For your theory to work the average fare would have to multiply evenly based on distance and take rates for ancillaries would have to also do the same. Not the real world.
I don't think it is efficient from the revenue standpoint. It is rather stable from that standpoint. Efficient? How so? I don't understand your SW comment. They want to be where we are?
If its not efficient what are you proposing? That we run a high frequency/low # of city (comparative to fleet size) network like Southwest has been historically...trying to capture market share? That is a losing proposition for any ULCC whether we are taking about NK, FR or DY etc. That is what is needed to achieve those sorts of efficiency you are alluding to.
SWA has almost 0 operational flexibility when it comes to network design because it is constrained via just about every department you can think of whether it is flight ops, ground ops, network planning or even revenue management and marketing. For the last 4-5 years they have been trying to figure out how to achieve levels remotely similar to ours so they can squeeze out optimum market times and aircraft flows system-wide and not try to make up various inefficiencies with power-margin markets like Intra-TX/CA. For the record, SWA does not really want to just be like us when it comes to this flexibility, they want to be like anyone else but them...and they are taking baby steps to achieve that level.