Originally Posted by
Stayontarget
My question is does basic economy set the low end of the prices or do the ULCCs? If it’s BE than ya the ULCCs are probably in big trouble. According to the, very old now and prior to BE, study describing the jetblue effect the low end sets the prices. So If we aren’t fighting with each other do we get to ratchet up the prices over time? Do we get rid of overlap to compete more effectively? Certainly more possible.
Frontier is currently showing a turn around from massive losses to a profit in Q4. It’s not a trend yet but it’s a start. New CEO, new VP of flight ops who happens to have experience in mergers, new CP incoming, investment in seats, major backend processes, 10% fleet growth and a large block hour increase in 2025. Then Indigo is trying to merge two Mexican carriers to be the dominant Mexican airline who would also happen to have a code share with possible the only American ULCC. I just have a hard time seeing all of these as coincidences any longer and see them as more of a plan that was supposed to happen twice before now.
Will it happen and even if it does will it matter? I have no idea but I’m cautiously optimistic.
Lets just say you are right about ULCCs setting the price. As a stand alone, we have no chance given our new route network. What do we fly to, 4 airports west of the Mississippi now? B6 just announced FLL to DFW. Sharks are in the water and offering destinations 3x a week isn’t good for reattracting customers we have driven away.
And let’s say there is a Merger, we don’t have the cash on hand right now to make payroll at the end of the month unless we get another round of DIP financing this week. Zero chance we can make it long enough to go through the regulatory approval to complete an entire merger. We will be out of liquidity by the time we have our first scheduled hearing with the DOJ.