Could be.

I'm not a fan of 100 seaters. Or to be more specific, I'm not a fan of what I've seen with pilot pay on 100 seaters thus far!

Al

 

No way. Southwest doesn't play that game. They don't enter a market unless it can handle the traffic of say, 5 destinations for 737s immediately. If the market would only fill a 100 seater, they would either lower prices to fill their jets, or not serve it. The additional cost of a different aircraft type cannot, for Southwest, be made up with higher revenue.

Remember, a different aircraft type comes with all sorts of costs - two sets of maintenance parts, cost to train people on the new jet. Cost to train their replacements on the old jet. Cost to buy simulators. Cost of people in training who aren't generating revenue. Cost to train flight attendants. Possible moving costs of people bidding new jet. Opportunity costs when wrong sized jet is in the right city. Cost to train maintenance personnel, dispatchers, deicering personnel.

It seems like the only airlines making money these days are those who keep it simple.

 

Point 1: SWA's customers (like everyone's customers) want the cheapest ticket they can buy. As of now, SWA management doesn't have the need to pursue the RJ option. Who knows what it will look like 10 years from now. If SWA can find a way to outsource to RJs, I think they will.

Point 2: 10-15 years ago, mainline flew 70-100 seat F-28s, DC-9s, and F-100s at reasonable pay.

 

While there is elasticity in the markets, it's not just about finding the cheapest tickets available!


Al

 

Perhaps in the old days but SWA has changed their M.O. in recent years to catch more revenue opportunities. They now serve airports like BOS, MSP, and LGA which they'd never touch 5 years ago, plus they were going to keep Lynx in the Frontier deal. IOW, never say never. I wouldn't be surprised to see them with an E190 type aircraft for use on thinner routes & smaller markets much as JetBlue does. For the future -- a more modern 737...I hear Boeing is looking at re-engining the NG with a newer powerplant to make it more fuel efficient.

 

This time it is going to be an organized formal process, in the past it was a bit haphazard with boeing sometimes only listening to folks who happened to know someone, or who wanted to order some airplanes early. My understanding is that they will seek industry consensus next time (not sure how hard that is going to be).

Maybe you haven't kept up on things...P&W is definitely designing a GTF which can power a NB. GE and RR are poking around with open rotors and improved conventional engines. Open Rotors are potentially more efficient, but they have serious technical drawbacks...the airframers delayed their next NB partly in order to give engine technology time to mature before they commit. An airframe has to be designed from a clean slate to use an open rotor.

Maybe, maybe not. I don't know of any plans at boeing (I know some senior managers there) to go to an all-common family. That would be too constraining on future designs if they had to stay backwards-compatible.

And as I can attest from experience when you start pushing the edge of the envelope on commonality it gets hard for the crews to keep up with the differences. About half of the airlines who operate my airplane do not use a common pilot pool for different variants even though it would be legal...this is due to safety concerns. If I ever forget which variant I'm flying, I will bend metal on landing.

It is unknown how far up the GTF can scale...it might be practically limited to NB or smaller aircraft, but at 15%+ improved fuel efficiency that is enough to justify a separate Mx program at an airline.

GE could do it if they wanted to. It must not be that pressing of a business concern.

 

I think some of you may be overestimating the clout of the new SWA. Our current leadership is a group of timid beancounters and lawyers barely able to cope with day to day operations, much less employ anything resembling strategic planning.

It's not Herb's airline anymore, I'm sorry to say.

 

The current contract scope is pretty iron clad, and I believe industry leading. MGT could of course choose any airframe they feel would best serve their markets, but those aircraft must be flown by SWAPA pilots on the SWAPA seniority list. The only exception is inter-island Carribean or Hawiian flying. I could care less what airframe is operated by SWA as long as SWAPA pilots fly them.

 

Gary Kelly disagrees. Look at his comments at the Next Generation Equity Research conference in December (should be available on you investor relations portion of your website). He called code sharing SWA's next great opportunity, but they need technology changes to make it work. I don't know your scope well enough, but Kelly seems to think it isn't an impediment.

 

Gary doesn't seem to be interested in code-sharing via RJ's. He seems to care more about creating agreements with foriegn carriers. AKA Volaris, and WestJet.