Originally Posted by
E6BAV8R
You make a good argument. But, this is exactly the same way new (and cheaper) airlines have always entered new markets. If I recall correctly, it just came out last week that, on a per route operational cost-basis, NK is 46% cheaper to operate than United. AA, and Legacies, can price match all they want, but they'll certainly be losing money on a per route cost. Sure, they'll keep doing it (particularly from AA towards South Florida), but they're also on track to lose more than $1 Bill this year; whilst United and Delta are expected to make profit.
They can price match all they want, but they can't compete in the long term. Well... there's always bankruptcy. Which, AA will need a miracle, over the next few years to avoid it anyway.
People said 5-6-7-8 years ago, that AA would be filing bankruptcy "within the next couple years".
AA's costs, as with all the legacies is double Spirit's. But so is their average revenue. I believe all three legacies reported a profit for Q2, will NK? Yes, I know JB is in the same boat. But the point stands. It should be clear to you, if you step back and look at the entire picture, that simply having the lowest CASM doesn't guarantee success.