Originally Posted by
LinaPeru
it’s not about doubling in size. The ULCCs are the only airlines trying to make money through moving economy passengers. That’s why Barry is always droning on about CASM this, CASM that, .08¢ CASM, blah blah blah. The legacies have figured out moving pax is a side show. It’s a losers game.
Delta makes its money through credit cards, cargo, MRO services, training services, oil wells, premium/business, upgrades, intl. travel, lounges, on top of all the other ancillary fees (bags, Wi-Fi, drinks, etc.).
They also have a large regional network of 50-70 seat rjs that allow them to maintain routes and markets year round, while the ULCCs have to move in and out of markets because they can’t fill a 321 neo during the offseason. They probably run those RJs at a loss, hence why they have a much larger CASM. Again, they don’t care about moving pax.
doublign in size by over paying for a bankrupt company, bloated with debt, while waving a bear paw, and telling pax how much you love them isn’t the panacea you think it is.
doubling the size = a larger network and way better CC revenue. Why do you think frontier is so heavily invested in building loyalty right now. They know there’s no money in the actual fair, thus why we are getting a new app, first class, and completely redone loyalty program. It’s all about building a product that stimulates Credit cards.
If you go back and listen to earnings calls/investor summits then you will hear him say having a larger airline needs to occur along with partners around the world to make people buy into your airline CC.
if frontier would have overpaid for spirit they would have moved forward during bankruptcy and bought spirit then. they were cost disciplined and rejected the counter proposal. Everyone can talk smack about indigo but they are not bad investors.
End of story, this business is all about scale.