Southwest takes aim at LCC
 

US Airways Group Inc. and American Airlines are matching a two-day fare sale launched Tuesday by rival Southwest Airlines.


Dallas-based Southwest announced it was offering $30, $60 and $90 fares for tickets bought through Wednesday. Southwest's sale includes $30 one-way fares between Phoenix and Southern California, $60 fares between Phoenix and Denver, and $90 fares from Phoenix to Florida and Chicago. The fares are for travel after Labor Day and before Thanksgiving.


Tempe-based US Airways and Dallas-based American said they would match Southwest's fares.





Tell me this isn't Southwest trying to drive a stake in the heart of LCC.

Why would they match the fares? It is a money-losing idea. Why follow? Flights are full as is.

I'd understand these price wars from a business perspective if one of these airlines was actually able to drive a competitor into BK but it either doesn't happen or they file chapter 11 and make the employees give up pay and benefits in order to "compete"

All the business plans of these airlines are total b.s. because all they care about is load factor and market share instead of profits. I could fill an aircraft with 1,000 seats every time if I sell tickets cheap enough and then I would have the biggest market share and 100% load factor. I'll probably lose millions of dollars but that's ok because I'll just use scare tactics to force my employees to give up benefits and pay and then I'll repeat the whole process again.

When will these CEO's and management teams get it into their heads that it isn't all about market share or load factors but rather profits. Filling an aircraft to 60-70% load factor and making money is much better than filling it 80-90% and losing money. Who cares if you are the biggest in a market or have the highest load factors if you can't make any money?

I think that WN can do this to LLC. They are close anyway.

Here we go again
 

They probably anticipate that flights will not be full after Labor Day, especially if a competitor is able to steal customers with the low ticket prices. The bad news is that fare wars usually leave everyone with about the same market share, but less revenue. I think that computers have merely allowed marketing departments to make stupid decisions faster. :rolleyes:

Delta June traffic dips 6.3 percent - Atlanta Business Chronicle:

Actually this is against all carriers. The link below is more of a complete picture of what you were trying to report.

I feel Delta Airlines is the most vulnerable in this scenario. Their low cash situation coupled with a lot of excess capacity and employees resulting from the recent merger, have not been rightsized as of yet. This Southwest fare sale will only hasten the tough decisions Delta will have to make now that the honeymoon period is over.

Southwest Airlines sparks $30 fare war with American, Delta, United - The Business Journal of Milwaukee:

it's called "Race to the bottom"

Delta like all, will have and does have tough decisions. However, we have the most cash of all of the legacies right now. It buys time.

"Feel" all you want, but DAL has the largest cash "situation" of any legacy carrier.

Not have been right-sized yet? What are you smoking? Both NW and DL got out of Ch.11 BK barely more than 2 years ago....You don't get much more "right-sized" than that.


1. Over 80% of the ground stations have been merged, they are saving tens of MILLIONS each year on reduced staffing and real estate from that alone.

2. The new AF/KLM-DL joint venture is going to help DAL make a lot of money.

3. They are removing at minimum 124 rj's in the next 3 years and looking to cut even more.

I tend to find that when talking with LCC employees, they don't like to believe that our merger went relatively smooth when compared to their's.