Fare WAR

[SKY HIGH]

Southwest, JetBlue move to match Virgin America's fares
Fliers are already seeing fares drop ahead of the August launch of Virgin America. Low-cost rivals JetBlue and Southwest each said they would lower fares to match Virgin America's on certain routes. JetBlue, for example, is now offering $278 round-trip fares (plus taxes and fees) between New York JFK and the six California airports it flies to in the L.A. and San Francisco areas. That $278 fare matches the $139 each-way introductory fare (plus tax and fees) that Virgin America is selling on its initial flights between New York and California. Virgin America's home airport is San Francisco while JetBlue operates a hub at New York JFK.

Within California, Southwest says it will match Virgin America's fares for flights between the Bay Area and metro L.A. Virgin America is currently charging as little as $44 each way (plus taxes and fees) for its L.A.-San Francisco flights. "We'll keep a very close eye on them and compete vigorously,'' Southwest spokesman Chris Mainz says to Bloomberg News. "For the most part, you'll find our fares are very competitive if not, in fact, lower."

As for the lowered fares on JetBlue and Southwest, the San Francisco Chronicle says they "are for travel that begins on or after (Virgin America's start date of Aug. 8) and end by Nov. 14," when travel begins to pick up ahead of the fall and winter holidays. As for Virgin America, industry analyst Robert Mann Jr. wonders how the start-up will fare after the number of fliers drops following the busy summer travel season. "What happens after the post-summer peak?" Mann is quoted as saying by New York Newsday. "Is there enough [business] to go around? What's the pricing then? How aggressive do the incumbent [airlines] get? American and JetBlue are not just going to sit around."

 

[CynicalResAgent]

I was in SFO recently and saw a demo of Virgins IFE and it looks really impressive. The SFO region's population is pretty tech savy and trendy I think they'll like it. When comparing to WN personally I'd chose them even if the price were much higher.

 

[KCFlyer]

I was in SFO recently and saw a demo of Virgins IFE and it looks really impressive. The SFO region's population is pretty tech savy and trendy I think they'll like it. When comparing to WN personally I'd chose them even if the price were much higher.

The price most likely will HAVE to be much higher. IFE gadgets cost money. Their extra weight uses more fuel. A SFO-LAX run isn't one of the most economical runs for getting maximum efficiency out of a jet engine. And have we gotten to the point where people can't make it an hour without some sort of entertainment? Scratch that - I just noticed an SUV with kids in the backseat watching a DVD on the trip to a grocery store less than a mile a way.

 

[BoeingBoy]

The price most likely will HAVE to be much higher.

Not necessarily. Every startup, assuming they start with new equipment, has built-in cost advantages. Every employee is on the bottom rung of whatever the pay scale is. No heavy maintenance is due on the airplanes for years. An airplane is never more efficient than the day it rolls out of the factory, assuming no technological changes like the blended winglets added to Boeings.

Jim

 

[NewHampshire Black Bears]

Not necessarily. Every startup, assuming they start with new equipment, has built-in cost advantages. Every employee is on the bottom rung of whatever the pay scale is. No heavy maintenance is due on the airplanes for years. An airplane is never more efficient than the day it rolls out of the factory, assuming no technological changes like the blended winglets added to Boeings.

Jim

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VERY good point "BB" !!
( I know my pal KCF is WELL AWARE of that info, but perhaps he was having a.......soon to be approaching "Senior Moment")

NH/BB's

 

[flygirl74]

Not necessarily. Every startup, assuming they start with new equipment, has built-in cost advantages. Every employee is on the bottom rung of whatever the pay scale is. No heavy maintenance is due on the airplanes for years. An airplane is never more efficient than the day it rolls out of the factory, assuming no technological changes like the blended winglets added to Boeings.

Jim

Look at jetBlue. Same thing..darling of Wall Street until those later operational issues start to crop up. Higher wages, heavy maitenence checks...

 

[CynicalResAgent]

Not to mention everyone knows VX will eventually apply for codeshare rights to feed passengers to VS flights. They will have an enhanced revenue premium there.