They'll fix the glitch one day and their will be no tail numbers in the system if we keep ****ing off the world. I deadheaded yesterday on us and it was such a nice experience. No drama, acro seats, smooth flight, on time, nice flight attendants. We have so many flights like this but our airport experience is absolutely terrible. If they could get that fixed it would change so much. Great call out sourcing the gate agents. Not that FLL is peaches all the time and those are still our people.

 

Placeholder for Allegiant...

 

Ooo. The suspense continues to grow!

 

Ouch!!!!!!

 

;-) yeeeeah.. That would be quite unfortunate.

 

<https://www.flightglobal.com/>

ANALYSIS: Are American’s LCC concerns justified?

26 OCTOBER, 2015 BY: EDWARD RUSSELL WASHINGTON DC

American Airlines executives seem a little spooked by the growth of ultra-low cost carriers (ULCCs) in their hubs, firmly arguing for matching nonstop fares with these nimble competitors to the chagrin of analysts.

Under their analysis, about 87% of the Fort Worth, Texas-based mainline carrier’s passengers only fly it once a year and represent about 50% of revenue, executives said during a quarterly earnings call on 23 October.

“We have that 50% of customers who are very infrequent travellers who fly us once per year – 50% of our revenue who fly us once per year or less, for whom air travel is largely a commodity,” says Scott Kirby, president of American, during the call.

He continues: “50% of our revenue is up for grabs in these markets and that these carriers [ULCCs] have had so much success when they weren't matched… If we are going to fly head-to-head and compete nonstop to nonstop with any carrier around the globe, we are going to be competitive and match their prices.”

Kirby cites the incursions of Frontier Airlines in Chicago and Miami, Norwegian on transatlantic routes, Spirit Airlines out of Dallas/Fort Worth and Volaris on routes to Mexico as examples of ULCCs that American is directly competing with.

Chicago O’Hare, Dallas/Fort Worth and Miami are all large hubs for the mainline carrier.

The fare matching is a concern for analysts. Hunter Keay, an analyst at Wolfe Research, and others have argued for months that it is degrading yields in key markets for American, as well as the other mainline carriers, and allowing business travellers to take advantage of the lower prices even when they would have spent more.

Keay called it “disruptive to the domestic pricing environment” in an interview with Flightglobal earlier in October.

American reported passenger revenue per available seat mile (PRASM) dropped 6.8% systemwide and 7.6% in the domestic market during the third quarter.

Delta and United reported PRASM decreases of 5% and 5.8%, respectively, during the period.

Kirby says fare matching has had little impact on passenger unit revenues as American has been able to increase load factors in markets where it matches by directing those bookings to off-peak flights.

“We're pretty happy with our results so far,” he says. “In markets where we've matched ultra-low cost carriers, our RASM performance has been the same as it has been in the rest of our domestic system. So we've performed just as well.”

Analysts do not entirely agree with American’s maths. They question that 87% of passengers only fly American once a year, citing the fact that its frequent flier programme has the most members of any around the world, and pointing to the fact that ULCCs target origin and destination passengers while American carries high numbers of connecting passengers on flights over hubs.

“American's current strategy has been successful as low jet fuel and an unhedged [fuel] strategy have driven meaningful margin improvement,” says Helane Becker, an analyst at Cowen, in a report on 23 October. “That said, in a high jet fuel environment and presumably a higher fare environment, American remains a market share loser given its high cost structure.”

Analysts generally resigned to the fact that American is unlikely to end fare matching despite their concerns.

SEGMENTED FUTURE

American management’s fare matching strategy is not entirely set in stone. Kirby outlines plans for a new fare segmentation initiative in 2016 that will allow it to better compete with the Frontiers and Spirits of the world while boosting ancillary revenues.

“[We will be] doing more to further disaggregate the products and really move to a world where we can offer fares that compete with low-cost carriers and have a suite of attributes that are appropriate for those prices,” says Kirby. “The attributes that you get if you buy ultra-low cost carrier competitive fare are going to be different,” he adds without elaborating.

Analysts are generally positive on this move, which is similar to the “basic economy” fare that Delta launched earlier in 2015.

“We believe this approach helps de-commoditise [American’s] offering to some extent and lowers costs on fares where it matches ULCC pricing,” says Savanthi Syth, an analysts at Raymond James, in a report today. “The devil is in the details, but we expect the implementation of such a product sometime in 2016 will be positive for both American and industry yields.”

Delta has been positive on its branded fares initiative, which includes basic economy, since its introduction in February. The Atlanta-based carrier says ancillary revenues have increased under the initiative, including an “additional $75 million in high margin revenue” in the third quarter, said Delta president Ed Bastian on 14 October.

The premise is that Delta can increase the number of ancillary products passengers buy by not including things advanced seat assignments or complimentary first class upgrades for elite frequent fliers in a basic economy fare. In addition, the fares are only offered as an option to passengers, who can still book regular economy tickets that include seat assignments and complimentary upgrades.

Bastian calls it the airline’s “Spirit-match fare”.

Delta had rolled out basic economy fares in 462 markets where it competes Spirit and other ULCCs by the end of September, he says.

American is betting that its planned fare segmentation initiative will allow it to better compete with ULCCs while still offering the same amenities as before at higher price points to frequent travellers.

“It's all about giving our customers choice,” says Kirby.

The new fare initiative is possible following the integration of American and US Airways on a single reservations system. A significant milestone in the carriers’ merger, which saw 4% of system reservations moved to Sabre, was done on 17 October largely without a hitch.

Kirby and other airline executives have said previously that it would realise a number of additional revenue synergies from the merger following the reservations integration. These include harmonising fares and further schedule and fleet rationalisation.

 

Dynamic 767 on fire and emer evac at FLL. Just short of the hold short line for 28R.

But hey, when the news copters pulled back, Spirit's yellow planes were in plain sight!

Looks like FLL is temporarily closed.

 

Those mysterious aircraft in the FA charge card devices are probably left over artifacts by the contractor which supples the devices and the catering. Sorry

 

Did anyone ever get a real answer about the last MEC meeting? what happened?

 

Back to work serf... They already told you what you need to know. And don't ask again.