Originally Posted by
Aero1900
I believe that the ULCCs in the US will survive and become an integral part of the industry. I'm pretty confident of that. What I don't know is how large they can become? Spirit and Frontier both have big growth plans and will have a combined 500 airplanes. What percentage of the market share will ULCCs become is the real question here.
If you listen to Frontier & Spirit management, they will tell you that the ULCC market in Europe is very large and it's very small here, so we have tons of room to grow. The difference though is that Europe doesn't have a SouthWest. Europe is more legacies and ULCCs, where Southwest fills the gap between the 2 here in the US.
I believe that the Legacies and ULCCs can healthily coexist in the US. It's different products for different consumers. There is a huge spectrum of consumers in the US, and I think there's room for both types of airlines to do well.
As a ULCC pilot myself, I hope to see the ULCCs do well, but I understand that it's a second tier airline. The latest round of contracts have pretty well settled that. I currently make about 15% less than my counterpart at United.
There are 2 questions that deserve further discussion.
1) How does Frontier/Spirit do during a recession?
2) Can they break into the transatlantic market? (Frontier has 18 A321XLRs on order)
I don’t know how to insert comments within quotes, but I’ll add my two cents.
First, I do think the ULCC’s have plenty of room in the US to survive and thrive. They’ll have to continue to be creative with routes to deploy all those 500 aircraft orders though. I think if the ULCC’s really start throwing routes up overlapping the Legacies, there will be push back. Who wins, I don’t know. The legacies have deeper pockets, but anti-competitive laws level the playing field for the ULCC’s.
As far as your comment about making 15% less than your peers at United, you used to make 45-50% less, so you’re moving in the right direction, and if you consider the quicker upgrade and time value of money, which offsets some of the lost income from widebody opportunities, it’s a much better gig at Frontier, Spirit, or Allegiant, than it used to be. It’s a much closer call that it has ever been. (Except when Spirit was paying more than the Legacies for a while back in 08-10? Maybe?)
I think we will all be fine. Will Spirit and Frontier do well during a recession? Yes, that’s the sweet spot for the ULCC’s. When consumers are more price conscious, you’ll have more legacy customers buying tickets on the ULCC’s.
Can you break into the Transatlantic market? I’m sure eventually, but the Legacies aren’t just going to roll over and give you an opportunity on a platter. JBLU was talking about it and everyone assumed they’d be flying JFK LHR. Those slots are impossible to get so Delta and Virgin tried to box them out of the UK by adding service from Bos and JFK to Gatwick and Manchester. Our masters aren’t going to give anything to your masters, but if the ULCCs found some lucrative tertiary markets that the Legacies didn’t see much value in, then you’d be on your way. Something like BWI-SNN, or MCO-Valencia Spain. I don’t know. If you have an east coast hub with feed, pick a medium sized European city with an LCC of their own or a good train network and you might be able to pull off seasonal service. But going head to head with the Legacies on THE most lucrative international market is going to be met with stiff competition.
I hope my comments didn’t sound biased or condescending. I think we can all thrive, but it won’t all be easy and smooth sailing. I feel like the “leaders” at Spirit and Frontier try to rally and motivate the troops by saying “We are taking the fight to the enemy! We are going to kick their asses at their own game, in their own hubs! But the smarter play is to continue where you’ve been the most successful, which is growing where we ain’t.
A friend of mine got hired at AirTran after we ended up furloughed in 2002...he said the talk about how AirTran was really putting the screws to Delta every hour of every day by every guest speaker that welcomed the new hires was tough to listen to. But the other new hires got fired up over it. Everyone wants to believe they work for a first class outfit that’s doing new things or has original ideas. The truth is, we are all just cogs in our separate wheels trying to earn a living.
I jus finished a 5 day trip with 28 hours flying, with 7:50 block today and a 4:00 am CST wake up. Sorry if I didn’t make much sense. It made perfect sense to me while I was typing it. I’m going to bed. Peace