RAH drops Midwest name in favor of Frontier
04-18-2010, 08:22 AM
#31
Che Guevara
Joined APC: Aug 2005
Posts: 6,408
Originally Posted by jsled
RAH's costs are going to go up which will not help. I don't see this ending well for you, Duck. I think your safe for a few years, but....time will tell
04-20-2010, 08:11 AM
#32
Line Holder
Joined APC: Apr 2009
Posts: 78
Originally Posted by ToiletDuck
We'll just have to wait and see. Airlines have been running around losing billions, some even having to borrow cash from RAH, meanwhile during this time RAH has still made money. Their CASM may go up but based on the numbers provided they are still well below the Legacy names and can afford it. I don't know how it's going to work out for me personally but as far as the company goes I feel more confident in it's stability then some of the majors.
04-20-2010, 11:01 AM
#33
Gets Weekends Off
Joined APC: Jun 2006
Position: FO
Posts: 179
Originally Posted by ToiletDuck
We'll just have to wait and see. Airlines have been running around losing billions, some even having to borrow cash from RAH, meanwhile during this time RAH has still made money. Their CASM may go up but based on the numbers provided they are still well below the Legacy names and can afford it. I don't know how it's going to work out for me personally but as far as the company goes I feel more confident in it's stability then some of the majors.
04-20-2010, 11:41 AM
#34
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Joined APC: Jul 2009
Posts: 624
Originally Posted by jsled
Codeshare is not revenue sharing or fee for departure. If codeshare is the "future of the regionals" then the past is repeating itself. Codeshare was how the regionals used to operate. Codesharing with a major and getting the revenue from the flights it operated. The problem was that mainline was only getting feed, not direct revenue from the regional flight. Thats why fee for departure came into being. With ffd, a major can get feed AND revenue from a regional flight. Codesharing is nice to fill some extra seats, but it will not allow you to farm out your airline. You will starve while your codeshare partner gets rich. Make no mistake, the majors (UAL in particular) want fee for departure, "joint ventures", and "revenue sharing". That way they can get the revenue without the operating expense.
If RAH establishes a codeshare with UAL (just a hypothetical, for illustrative purposes here), both airlines have the ability to generate revenue.
RAH obviously wins, because they will be plugged into everyone's website and they instantly become a sizeable operation providing domestic, narrow body lift.
This is the exact gauge of aircraft that UAL has given up on, as they parked nearly 100 737's without a replacement. UAL also benefits due to the fact that a large percentage of the passengers just don't walk away from the airport when they deplane from a RAH flight. They connect to a higher yielding international flight, or at least that is what UAL hopes they will do.
With ticket prices settling into the "new normal", legacy carriers like UAL will never be able to sustain domestic narrow body lift due to the disparity between their casm and domestic yields. While they could possibly eke out a profit during booming economic conditions, they just bleed to death during the down cycles.
I think all of the LCC's have fatally damaged legacy balance sheets domestically. They will stick to the few profitable segments, and shed the rest to sub 7 and even 6 cent CASM operators, hoping for as much international feed as possible. Some is better than none.
04-20-2010, 12:28 PM
#35
Moderator
Joined APC: Oct 2006
Position: B757/767
Posts: 13,088
Originally Posted by zoooropa
I completely agree with your post, except for one dynamic piece of the puzzle.
If RAH establishes a codeshare with UAL (just a hypothetical, for illustrative purposes here), both airlines have the ability to generate revenue.
RAH obviously wins, because they will be plugged into everyone's website and they instantly become a sizeable operation providing domestic, narrow body lift.
This is the exact gauge of aircraft that UAL has given up on, as they parked nearly 100 737's without a replacement. UAL also benefits due to the fact that a large percentage of the passengers just don't walk away from the airport when they deplane from a RAH flight. They connect to a higher yielding international flight, or at least that is what UAL hopes they will do.
With ticket prices settling into the "new normal", legacy carriers like UAL will never be able to sustain domestic narrow body lift due to the disparity between their casm and domestic yields. While they could possibly eke out a profit during booming economic conditions, they just bleed to death during the down cycles.
I think all of the LCC's have fatally damaged legacy balance sheets domestically. They will stick to the few profitable segments, and shed the rest to sub 7 and even 6 cent CASM operators, hoping for as much international feed as possible. Some is better than none.
If RAH establishes a codeshare with UAL (just a hypothetical, for illustrative purposes here), both airlines have the ability to generate revenue.
RAH obviously wins, because they will be plugged into everyone's website and they instantly become a sizeable operation providing domestic, narrow body lift.
This is the exact gauge of aircraft that UAL has given up on, as they parked nearly 100 737's without a replacement. UAL also benefits due to the fact that a large percentage of the passengers just don't walk away from the airport when they deplane from a RAH flight. They connect to a higher yielding international flight, or at least that is what UAL hopes they will do.
With ticket prices settling into the "new normal", legacy carriers like UAL will never be able to sustain domestic narrow body lift due to the disparity between their casm and domestic yields. While they could possibly eke out a profit during booming economic conditions, they just bleed to death during the down cycles.
I think all of the LCC's have fatally damaged legacy balance sheets domestically. They will stick to the few profitable segments, and shed the rest to sub 7 and even 6 cent CASM operators, hoping for as much international feed as possible. Some is better than none.
UAL won't need RAH for 100 seaters when the merge with Continental.
04-20-2010, 03:42 PM
#36
Gets Weekends Off
Joined APC: Apr 2006
Position: 737 CA
Posts: 2,750
Originally Posted by zoooropa
I completely agree with your post, except for one dynamic piece of the puzzle.
If RAH establishes a codeshare with UAL (just a hypothetical, for illustrative purposes here), both airlines have the ability to generate revenue.
RAH obviously wins, because they will be plugged into everyone's website and they instantly become a sizeable operation providing domestic, narrow body lift.
This is the exact gauge of aircraft that UAL has given up on, as they parked nearly 100 737's without a replacement. UAL also benefits due to the fact that a large percentage of the passengers just don't walk away from the airport when they deplane from a RAH flight. They connect to a higher yielding international flight, or at least that is what UAL hopes they will do.
With ticket prices settling into the "new normal", legacy carriers like UAL will never be able to sustain domestic narrow body lift due to the disparity between their casm and domestic yields. While they could possibly eke out a profit during booming economic conditions, they just bleed to death during the down cycles.
I think all of the LCC's have fatally damaged legacy balance sheets domestically. They will stick to the few profitable segments, and shed the rest to sub 7 and even 6 cent CASM operators, hoping for as much international feed as possible. Some is better than none.
If RAH establishes a codeshare with UAL (just a hypothetical, for illustrative purposes here), both airlines have the ability to generate revenue.
RAH obviously wins, because they will be plugged into everyone's website and they instantly become a sizeable operation providing domestic, narrow body lift.
This is the exact gauge of aircraft that UAL has given up on, as they parked nearly 100 737's without a replacement. UAL also benefits due to the fact that a large percentage of the passengers just don't walk away from the airport when they deplane from a RAH flight. They connect to a higher yielding international flight, or at least that is what UAL hopes they will do.
With ticket prices settling into the "new normal", legacy carriers like UAL will never be able to sustain domestic narrow body lift due to the disparity between their casm and domestic yields. While they could possibly eke out a profit during booming economic conditions, they just bleed to death during the down cycles.
I think all of the LCC's have fatally damaged legacy balance sheets domestically. They will stick to the few profitable segments, and shed the rest to sub 7 and even 6 cent CASM operators, hoping for as much international feed as possible. Some is better than none.
, there are plenty of 737's to go around.Second, If you reduce the number of players, pricing power will increase. Same number of jets, just less names painted on the side = pricing power.
Third, DAL just reported a casm ex fuel of 8.72 cents which is only 17% above LUV's 7.45 4th quarter casm ex fuel. I can remember when LUV had a 50% cost advantage over the Legacies and bragged about it! 17% likely does not cover the revenue premium that DAL gets where they compete. Which is why LUV is trying to raise its RASM with prefered boarding and the free drink (higher fares). UAL's mainline casm ex fuel was 8.50 last quarter-14% higher than LUV but with a higher avg fare per pax (revenue premium). I point this out because LUV is the big dog of LCCs and is a big factor in domestic fares.
04-20-2010, 06:23 PM
#38
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Joined APC: Feb 2007
Position: E-170
Posts: 842
Originally Posted by jsled
And it is those majors that RAH depends on for the majority of its revenue!
and if something happens to those majors they can just paint an animal on the tail of those airplanes and fly them under the frontier brand. so they may be dependent but if one of the majors vanish either through chapter 7 or a merger there will be some room for picking up a few routes.
04-20-2010, 07:07 PM
#39
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Joined APC: Apr 2006
Position: 737 CA
Posts: 2,750
Originally Posted by Killer51883
and if something happens to those majors they can just paint an animal on the tail of those airplanes and fly them under the frontier brand. so they may be dependent but if one of the majors vanish either through chapter 7 or a merger there will be some room for picking up a few routes.
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