Originally Posted by
Brown
I'd like to see the branded operation work because I'm still rooting for my old company, but let's face it, the odds are slim. XJT doesn't even want to release traffice data because they know that the other airlines will move in a crush them. So basically, they can't even get up an running anywhere. We can agree to disagree, but I don't think the branded operation is the way to go. I give it a very low chance of working out and ever making any money.
They really should be working on getting more business and signing more agreements with other airlines, much like they did with Delta.
They will be kicking themselves, if it turns out that Southwest decides to contract with rj feed too. XJT could have had that, had they not decided to compete with SWA instead. Bad move in my opinion.
Originally Posted by
Brown
I think they will have to close down branded to stop the bleeding, and then concentrate on being the best 50 seat regional out there. JMHO.
The problem with other CPA's is that if the agreement exceeds 10 aircraft we have to give those rates to CAL if they are lower. Now I don't know what CAL gets, and I don't know what our management thinks would be competitive but they obviously thought that we could make more money by doing branded and having 205 airplanes fly for the current CAL rates than being in another CPA with 69 airplanes and flying 205 airplanes for CAL at the same rate as the new CPA. 10 airplanes with Delta are on a CPA for rates lower than what CAL gets. I make this assumption because the other Delta airplanes are on a "pro-rate/codeshare" agreement where we don't get a fee for departure but get a majority % of the operating revenue or loss.
I would like to think that the people that made this choice know more than you or I, but I don't know if it was the right choice either. I think we need to give it time. Besides we're just pilots anyway. I have an finance degree and I still don't pretend to know whats going on but for some reason some people that sling gear of a living seem to know everything.
ALSO - Southwest can not just "decide" to contract RJ feed. Their pilots have pretty iron clad scope clause - it's been posted (feel free to do a search) and I don't think it's something we'll see.
The company was put in a tough spot. Our CPA with CAL was writen by CAL not XJT so that when they IPO'd us it would work out for them. Now we have some tough language and red tape in there that (I assume) most other RJ operators don't have to deal with and we were handed 69 airplanes. You can't compare our situation to anyone else because the fact that our CPA with CAL is booby-traped.
I also don't think we can call startup costs "bleeding". I mean really we needed to do alot of stuff. Starting an airline when everything you use is owned by Continental isn't cheep or easy. I think you're jumping to conclusions just a little too fast here. Lets wait untill the XJT stuff has been operating for 2 years before we start throwing ideas like this around. The company has the cash to float it for at least 3 more years.