4merresrat said:
Bear96 said:
But Herb is right.
You can talk big all you want to, but if fares go down (and they will) to a level where WN can make a profit and U is still losing its shirt, it is only a matter of time.
And etops1... "this low cost mania too shall pass?" Where have you been? The American public thinks it is their Constitutional / God-given right to have low fares, even if is built on the backs of airline employees. It's the continued Walmartization of America. This "mania" ain't going anywhere!
Well put, exactly, the general public does believe it is their right to travel, and if not free, well, then cheaply, and how dare a company try and make a profit. It has gotten WAY outta control. THe only way I can see it ending is if an airline or two goes out of business and gets the seat capacity in line. But hopefully not US!
"How dare a company try and make a profit?"
You might want to think about that -- SW is all about being profitable.
"The public", business travelers in particular, are simply tired of being arrogantly gouged. "If I say it's $1,900 to SFO and you need to be there tomorrow then you'll pay $1,900" and all that bull. It doesn't take a degree in rocket science to recognize this stuff.
We've got nothing against profits. Most of us out here in "the public" recognize the need to make a profit just as we recognize the need for a fair and livable wage.
The problem with US Airways is that the company has never understood how to make a profit the old fashioned way -- by having a viable business. They have essentially counted on "business travelers" to be unwillingly to admit to seeing what was going on all around them. For a while it was a cozy arrangement -- business travelers got some nice "perks" and willingly participated in the myth that SW wasn't a "business" airline. Then US and their legacy friends started pushing the envelope while putting the screws on business travelers -- more and more restrictions, higher and higher fares, fewer and fewer perks. Meanwhile the business travelers customer's (who ultimately pay the bills) are starting to question costs as they become aware of and gain insight into their supply chains -- why are you billing me $2,000 for this trip? Suddenly the deal isn't so good... It's not so easy to wink and say "SW isn't a business airline" to the bean-counter in the customer's accounting department. Especially when the conversation happens in the boardroom.
What, exactly, is US (or any legacy carrier) offering that SW doesn't? The list is very, very short and not at all convincing. And the list of things that SW does better is pretty impressive to a customer. The lack of sufficient positive differentiation (at any price point ) is what has brought the problem about and unless it is addressed it will ultimately doom the airline. The surplus negative differentiation will only hasten the downfall.
That has to change fast. A lot of "sacred cows" are going to have to go away for it to happen. There is nothing special about the backs of airline employees -- you all put your shirts on just the same as I do and you have no more of a target painted on your shirt than I do mine (which is to say that we all have a target on us when it comes to watching costs...)
And another thing... the only "excess capacity" that this industry suffers from is an excess of over-priced and overly-restricted walk-up fares. Those of you who buy into that and this balogna about the public only caring about fares are drinking management kool-aid that only serves to strengthen their case against labor costs.
