Luv Into Phl

[KCFlyer]

OK KC FLyer here it is,

I am going to LAX on Monday Nov 10th return November 13th. Just finished pricing the flight.

US Airways PHL-LAX = $290.00 NONSTOP, Red eye return.

SWA - BWI-LAX = $466.00 - Out = BWI-BNA-LAX, return Non Stop.
SWA requires and extra night in a hotel because there is no red-eye which add another $129.00 to the cost of the trip.

For over three years I have attempted to fly SWA with my ONLY Criteria being a lower fare and I have yet to find one. NOT ONCE! And lets not even get into the number of connections or the 2.5 hour additional drive time to get to their airport as that will change.

For the record I did this cold upon reading your post. No searching just called up the same dates and went for the lowest fare. I do that trip pretty regularly and SWA has never been cheaper than US Airways.

Bob - how much money do you think US is making off your fare? Your problem is this - if US is to compete, they gotta meet, not beat Southwest's fares. If they are offering a fare that will not make them money (even if you change the fare and get charged the $100 revenue generation fee), then they simply will not survive. I too priced the last minute PHL-ORD fare on U - $682 -loaded with penalties and fees. Unrestricted was a whopping $1,400. Can U afford to do that? No - especially after Southwest starts competeing on the route. And if their strategy is to "out low fare the low fare carriers, then they might as well shut the doors and have that much extra money to pay off their creditors.

My point is, if U would have had the cajones to implent a "value pricing" structure 2 years ago, even the natsty, mean, lowlife folks in the city of brotherly love would have embraced this airline like nothing else. LUV would never have had a chance. Now, they face the prospect of creating some false image that they are the "low fare carrier of choice" by offering fares that lose them money each and every time. They got you on a BWI-LAX flight where they flat out won't make money, in a timeframe where they could have charged a fare that would generate just a little profit. That's great for you, but what's it do for the company? Instead, they are going to "beat" SWA at their own game. I'm no business genius, but I figure if it costs me a dollar to build a widget, I won't be in business long if I charge my customers .75 cents to walk out the door with it, and hope that they need an "adjustment" on their widget so I can charge them the .26 cent "change fee", thus putting me into a profit situation. If they don't make a change, I lose money. How long do I stay in business then? The other part of my strategy it to sell the the "fully flexible" widget for $6.00. Southwest on the other hand is building widgets for .99 cents, but selling them for $1.10. Who has the better chance for survival?

So the question then becomes - if U decided to meet but not beat Southwest's fares, would this launch you into a rant on how badly you are being screwed by the airline. The employees of the airline you are so complimentary of would have to work for next to nothing to support the fares they are charging on itinerary you cited. Is it fair to them?

 

[jimntx]

"Industry consultant Michael Boyd said the move into Philadelphia likely was aimed at preventing rival JetBlue from gaining a foothold there.

"This was a strike directly to stop expansion by JetBlue," he said. "This was not a strike against US Airways. US Airways was just an innocent bystander." "


So, US Airways is a victim of a run-by "looting"?

Oh heavens, no. US Airways is analogous to the Iraqi civilians who happened to live in the wrong neighborhoods when the bombs fell, and (now) the bombings occur--Just "collateral damage." Perhaps, a White House note to the surviving families at US Airways will make it all better. <_<

 

[DLFlyer31]

OK KC FLyer here it is,

I am going to LAX on Monday Nov 10th return November 13th. Just finished pricing the flight.

US Airways PHL-LAX = $290.00 NONSTOP, Red eye return.

SWA - BWI-LAX = $466.00 - Out = BWI-BNA-LAX, return Non Stop.
SWA requires and extra night in a hotel because there is no red-eye which add another $129.00 to the cost of the trip.

For over three years I have attempted to fly SWA with my ONLY Criteria being a lower fare and I have yet to find one. NOT ONCE! And lets not even get into the number of connections or the 2.5 hour additional drive time to get to their airport as that will change.

For the record I did this cold upon reading your post. No searching just called up the same dates and went for the lowest fare. I do that trip pretty regularly and SWA has never been cheaper than US Airways.

Seems to be that you are an excellent example of why US went BK. You are a frequent flier with CP status and you are buying transcons for $290!!! There's a reason why US has such low fares....they are desperate to fill the plane. WN has already sold all the cheap seats hence the higher fares.

However, your comparison is also less than ideal because this market already has low-fare service. Airtran flies PHL-LAX (via ATL), ATA flies PHL-LAX (via MDW) and HP flies PHL-LAX (via PHX). So U has been forced to lower its fares which is why you are getting such cheap fares.

Let's try another market without other low-fare carriers....I chose PHL-BNA and used the same dates as you. WN wanted $182 for BWI-BNA and US wanted $750 for PHL-BNA. Worst of all, the only way US would let you have the $750 fare is if you made a connection. The nonstop PHL-BNA flights were over $1000. Do you think the savings is worth it now?

WN also flies BWI-BNA about 8x daily all with 737's while US only has 3x daily PHL-BNA and some of the flights require you to be crammed in an RJ....meaning you could pay upwards of $1000 and possibly have no chance to get that precious upgrade to F.

 

[AOG-N-IT]

"I can see it now...the first Baby Crap 737 taxing down the runway and most of U's PHL ground crew giving the piolts and $39 one way fare passengers the finger and possibly mooning them as well. When the plane gets down to gate E10 25 minutes later there will probably be a usairways truck parked on their lead in line with 5 or 10 U employes upstairs having lunch."

Professionals at their best, eh

Well Well Well, Stoopidute442 just summed up 50% of what's wrong with our PHL operation in one paragraph. Nice job..and we appreciate the honesty from a PHL employee for a change. I know it's not all of you BTW !!

We Hicks from PIT and CLT that have no problems with doing our jobs..and without a chip on our shoulder really appreciate your contribution to the malaze that shrouds us.

Too many at U have been oh so eager to dismiss the Philly Phactor rather than correcting it...but they say that admitting a problem up front is 1/2 way to finding a resolve to the problem.


I can hardly wait for the vulgar and ignorant responses....you will only continue to proove the point as they trickle in.

 

[richb624]

Philadelphia now has about 6 million originating passengers. If it were a low fare city, it would have at least 10 million O-D passengers.

Let's say LUV builds up to 40 flights a day - that's about 1.2 million annual enplaning passengers. Most likely LUV's service will be to cities where U either just breaks even (PHX, LAS, MCO?) or where U has high fares and few passengers (PVD, BDL, RDU).

Conclusion of this scenario: U may lose 500,000 low-yield passengers the revenue which could be offset by reducing frequencies; or may lose the monopoly premium (say $50) per passenger on markets with few enplanements.

I think U's future depends a lot on general economy, a strong growth in international travel, and willingness of business travelers to spend. I think it would be a mistake to substantially reduce frequencies and array of destinations out of Pittsburgh - the base is not large but as U eventually reduces it's costs and reduces fares, passenger growth will occur and it will be nice to own the market.

 

[a320av8r]

"I can see it now...the first Baby Crap 737 taxing down the runway and most of U's PHL ground crew giving the pilots and $39 one way fare passengers the finger and possibly mooning them as well. When the plane gets down to gate E10 25 minutes later there will probably be a usairways truck parked on their lead in line with 5 or 10 U employees upstairs having lunch."

Lez doit!

We don't need management to lead, we DO have attitude!!!

 

[GadgetFreak]

Sorry PineyBob, I just dont think those numbers hold up. In my experience, US pricing is outrageous. I think the sale at AA may be over now but as of a week or so ago I could fly nonstop from JFK to LAX in FIRST CLASS on AA for less than half of what it would cost in coach on US. First class on US isnt close to as nice as it is on AA, but coach on US compared to first on AA, really.... The problem with your comparison with Southwest is that on US those cheap seats are limited in number and very restrictive in terms of changes. The ones from Southwest are neither. If you want to compare SWA and US on fares compare US Y to Southwest. The problem becomes rather obvious when you do that.

Another point that is very important was brought out in an article about this that someone posted. Southwest by some reasonable metric can be viewed as having the BEST CUSTOMER SERVICE of any airline! Fewest complaints is a very good thing and a good measure of customer service. People here are saying that the only reason people fly SWA is to save a few dollars. It just isnt true. For the casual flyer who doesnt understand fare rules, have elite FF status or fly internationally (most flyers) a strong case can be made that Southwest provides better service, less complicated pricing and a lower cost to fly.

Im going to fly out mile miles to make US1 again this year but I am very wary of this. Im probably going to need to start bringing my mileage balance down more. This doesnt look good to me.

 

[Hope777]

OK enough already..........Bottom line is this, its a Chess game and Herb put US in Check. There are still several ways out BUT, is Dave going to tip the King or is he really going to think this out? We have have run enough, CA, FL, and basically everywhere else. Draw the line in the sand and lets fight. Mark said it best, we need to change the way we operate our Hubs going to a rolling Hub concept like AA in DFW. Dave, it's time to do your job or GET OUT!!!!! Dave, it's your move.......

 

[FM2436]

A lengthy article from The Wall Street Journal, but with fares reported by WSJ on U to LAX at $2550 and LUV at $598, the WSJ is doing it to US Airways than is Southwest.

Southwest Goes for the Jugular
In Challenging US Air in Philly

THE MIDDLE SEAT
By SCOTT MCCARTNEY

In a small closet in the back of his office, back where he probably
stashes his bourbon, Herb Kelleher had a population map of the U.S.,
with heavy dots in the east and a more sparely dotted west. In the early
days of the eastern attack of Southwest Airlines, the chairman explained
the attraction by pointing to the map: Gotta fly where the people are.

For Gen. Herb, the eastern attack has been more methodical than any sort
of "shock and awe" blitz. Ten years ago, Southwest established a
beachhead in Baltimore, giving it presence in the Washington region, and
just as importantly a higher profile on Capitol Hill. Over time, the
airline picked off the easy and logical new cities. Boston was covered
to the north and south with Manchester, N.H., and Providence, R.I. New
York saw Southwest planes landing at secondary stops: Albany and Islip.
Midsized cities such as Hartford Conn., Raleigh-Durham, N.C., and
Norfolk, Va., made attractive stopping points, with Southwest
encountering little resistance.

But now, Herb is dropping the daisy-cutter bomb. On Wednesday, the
Dallas-based airline announced plans to open service in Philadelphia in
May with up to 14 daily flights. More will follow that.

Southwest's decision to attack Philadelphia sets up a battle that could
be the last stand for US Airways, a weakened foe that already has been
run out of Baltimore by the Southwest infantry.

Philadelphia seems perfect for Southwest. Like the map on the wall tells
Herb, there are lots of people there. Philadelphia is perfectly situated
to pump many more people into Southwest's network. Large-jet domestic
service has been cut back in Philadelphia as US Air has gotten smaller
and shifted more flying to commuter affiliates. Last year, the number of
mainline domestic flights fell 7.8% at Philadelphia International
Airport, and so far this year, mainline domestic flying is down another
7.9%. Trains serve the airport to downtown. Bottom line, the Philly
airport can handle a big jump in passengers.

More importantly, people flying into and out of Philadelphia are paying
among the highest fares in the country for air travel. An unrestricted
coach ticket from Philly to Los Angeles on US Air costs $2,550. Those
kinds of prices invite new competition. It's hard to understand how
airlines can keep selling their product that way when Southwest is
charging $598 round-trip to Los Angeles from Baltimore. US Air might as
well be out on the tarmac with two orange sticks waving in Southwest.

Still, Philadelphia is incredibly important to US Air, and the carrier
that just emerged from bankruptcy reorganization is probably unlikely to
go without a fierce fight. J.P. Morgan estimates US Air gets 25% of its
revenue in Philadelphia, which makes the City of Brotherly Love the
biggest single component in US Air's network. A significant hit there,
and there are few places left to which the carrier can retreat and still
survive.

It's not like Southwest's 737 tanks will ride through town and topple
statues next spring. In Baltimore, Southwest grew at a measured pace,
and US Air shrank at a measured pace. It took several years for US Air
to officially shed the notion that it had a hub in Baltimore. US Air had
45% of Baltimore traffic a decade ago and now has only 5%. Southwest has
more than 47% of the passengers at Baltimore.

Over time, this is exactly how the restructuring of the airline industry
plays out. City by city, traffic shifts to low-cost carriers. With low
costs, they offer low prices. Customers flock to those that offer good
value. The discounters cherry-pick the good routes from cities, not
serving small towns or, at least for now, international destinations.

There will be room for some big network carriers willing to fly to small
towns and take people overseas -- but probably only a few. Those that
survive will have to be efficient, with competitive costs. Big airlines
can co-exist with discounters offering better service and bigger
networks, and they can even get travelers to pay more for that. But not
a lot more -- maybe only 10% more, according to recent studies.

Two years ago, we had seven full-service network airlines in this
country. Trans World Airlines is gone, whittled down slowly over the
years for a host of reasons. AMR Corp.'s American Airlines tried to pick
up St. Louis by acquiring TWA's assets. But on Saturday, American said
it is sharply cutting its flying in St. Louis, dropping total daily
departures to 207 from 417. That includes American Eagle, which actually
will see a boost in departures there as American turns St. Louis into
something close to a regional-jet hub. Nonstop service to 26 markets
will be dropped -- and the majority of those markets are routes where
American found itself competing with Southwest.

Meanwhile, Southwest, which already has 12% of the total traffic in St.
Louis, is looking to add more. As one carrier replaces another,
travelers are still served -- perhaps better served, since they find
lower prices and more opportunity to travel.

So it goes.

The Philadelphia assault is a fascinating strategic move for Southwest.
Typically, the airline doesn't pick fights at fortress hub airports. It
will slip into markets through secondary airports, allowing existing
airlines to keep their product priced high while customers drive to
affordable flights at less-convenient airports. In Pennsylvania,
Allentown's airport built a new terminal and has been aggressively
courting Southwest, figuring it could be the next Oakland or Burbank,
Calif., or Providence.

Instead, Southwest is going for the jugular. Clearly the airline senses
US Air is vulnerable. Also, Southwest wanted to stake its claim to a
main East Coast population center before AirTran Airways expanded too
much there, or JetBlue Airways Corp. began looking for other East Coast
hubs.

Like many wars, this one will be long and drawn out. The airline
industry is evolving. But remember the day that Southwest said it would
invade Philadelphia. It may mark a significant turning point.

 

[boeingdriver213]

You can be sure that WN will make money out of PHL. But it's gonna take a lot more than Dave coming up with a "plan". Most U employees are so fed up with U that even the best plan in PHL won't work, because for any plan to work, the employees are gonna have to bust their buts to make it work! When you have been hammered relentlessly like the U employees, it's gonna take more than super Dave to fix this. Maybe new management that's willing to get out there with the front line employees and make it happen. Don't see that happening with Dave and his apple polishers.........

 

[7.5victim]

OK KC FLyer here it is,

I am going to LAX on Monday Nov 10th return November 13th. Just finished pricing the flight.

US Airways PHL-LAX = $290.00 NONSTOP, Red eye return.

SWA - BWI-LAX = $466.00 - Out = BWI-BNA-LAX, return Non Stop.
SWA requires and extra night in a hotel because there is no red-eye which add another $129.00 to the cost of the trip.

For over three years I have attempted to fly SWA with my ONLY Criteria being a lower fare and I have yet to find one. NOT ONCE! And lets not even get into the number of connections or the 2.5 hour additional drive time to get to their airport as that will change.

For the record I did this cold upon reading your post. No searching just called up the same dates and went for the lowest fare. I do that trip pretty regularly and SWA has never been cheaper than US Airways.

Well PineyBob, your loyalty to US is admirable, but it's easy to poke holes in your research. I frequently travel to PHL/NJ for business, and have found WN to BWI to be a much better alternative.

Using the same dates CLE to PHL, I have found the following on US:

Non-stops (Regional jets both ways): $1050
USAirways.com did offer me a lower price of $727, but it would require me to connect at PIT and BWI, BOTH WAYS.

CLE to BWI on WN:

Nonstops on a 737: $204 maximum, or less if available. I usually buy the $204 fare, since its refundable.

I'll be renting a car anyway, so no additional expense except a little more gas, because I'll be driving more. I'm still $500 or more ahead by flying WN.

Personally, I wish US had used Ch. 11 as a opportunity to institute Value Pricing. I'd pay a premium to fly into PHL. If I could have a fully refundable/changeable ticket on US for $300 for a seat on an RJ, I'd take it. But I won't pay 5x the WN fare just to ride on US.

 

[usramperTPA]

I'm sorry, you are obviously correct. The "slave labor" wage line must be between $7.50/hr and $8.60/hr then? I'm sure the FL rampers envy the US rampers when they pull in in their Hummers, right? Sorry, but labor costs, and labor productivity are the main reason that so many US mainline stations are now US Express stations. Good productivity benefits the employee as much as it does the company. Good productivity brings job stability. The most productive carriers are less likely to furlough. The best employees gain station seniority more quickly, as less motivated employees wash out. And the profit sharing bonuses offset pay differences, and give the employee a reason to be productive. Sorry, pay for performance works!

7.5victim,

You obsiusly didn't get my point in my response to your quote. All I did was argue the point about who has a better starting wage. Furthermore when you ripped me about the gap between hourly wages, just how much does an FL ramper make after 5 years? Around $12/hr, after 10 years? Us and most of the "legacy carriers" pay about $15-$16/hr at 5years and even after paycuts still pay between $17-$20/hr after ten years. That my friend is the "slave labor" line I speak of! We all know ramp work is hard physical labor, and should be paid accordingly. As for your reply about the benefits to our US brothers and sisters who have been "converted" to mainline express, how can a $9/hr paycut be a benefit? And more work to do also? Don't get me wrong, increased productivity is essential for any business, but to cut wages and benefits and then increase workload? That's insanity, period! I work be happy to work more flights and do more job functions if I had the same payscale as WN rampers! Not to mention that WN offers something that Dave and Co will not offer me, respect and gratitude! By the way, did you know that WN rampers make $2-$3/hr more than most of us with the equal seniority. Maybe some of us envy the WN employees when they get the pat on the back from Herb, and then they drive off in their Hummers!

 

[USA320Pilot]

See Complete Story

[Moderators Note- Pittsburgh Post Gazette Story- Topics Merged]

 

[robbedagain]

Chip: now with SWA moving into PHL area, what are the chances of US survivng and actually fighting them? Also does this mean that possibly Jetblue would enter
say Pit and put in another fight against US and stay away from PHL area for the time being?

 

[USA320Pilot]

The Southwest entry in Philadelphia will be another challenge for US Airways, but the attention being paid to this particular issue on this message board is too much.

Southwest will have its own challenges with this expansion. The company will canobalize its BWI focus city and the airline will see operational delays, regardless of what the company says about locating their operation on Councouse E.

ATC taxi clearances are provided on a first come first serve basis. How is Southwest going to handle the same delays as US Airways? When a thunderstorm rolls through and a ground stop is issued, how much money will a Southwest B737 make on its Philadelphia and subsequent flights throughout the day with its aircraft sitting on the Philadelphia ramp?

How will Southwest handle the de-icing problem and the new pad?

US Airways will not run from this fight Moreover, we should not be surprised by this announcement and the low cost pressure is going to mount throughout the country. The LCC's have grown their portion of the domestic ASM's from 3% in 1990 to 19% today. In addition, by 2007 they are forecast to have about 40% of the ASM's and their expansion will level off at about 50% of the ASM's by 2010.

Siegel is right that to compete US Airways and the other network carriers must have a competitive domestic cost structure, throughout the company, to survive. Does US Airways have to lower its CASM to Soutwest's level of 7.5 cents? No, but we do need to be below 9.0 cents. At this level, the company's RASM advantage due to the Caribbean, Central American, and European service, coupled with its marketing advantages (FFP, Clubs, interline handling), and revenue enhancements due RJ, MDA, and alliance expansion, should provide sustained profitability.

The revenue advantage will cover the a cost disadvantage of lets say 8.5 cents for US Airways to 7.5 cents for Southwest. However, let's make no mistake about it, it will be difficult for the company to get its costs per ASM down another 2 cents. Can it be done? Absolutely, but it's going to take out-of-the-box thinking and cooperation between management and labor.

Let's not forget the US Airways restructuring plan contained three basic elements: improve liquidity, reduce costs, and increase revenues. However, most of these revenue enhancements have yet to be realized.

Moving forward US Airways will realize improved financial results dues to greater alliance and RJ revenue, which is forecast to ultimately provide $600 million per annum, per the ATSB and Fitch Ratings independent audit. Last quarter the US Airways Express network added 9 additional affiliate RJs and a portion of the United alliance was increased, but both of these initiatives have scratched the surface of the revenue enhancements.

For example, just three days ago the Lufthansa alliance began, yesterday PSA took delivery of its first RJ, and the EMB-170 is expected to receive its certification this week.

Most of Siegel's $600 million per annum in business plan revenue enhancements have yet to be realized.

These revenue enhancements if thye had been fully implemented last quarter, would have provided US Airways with about $150 million in additional revenue, thus the company would have had about the same results as Northwest and Continental, who are bigger companies with a greater revenue base.

Going forward, revenues will continue to face pressure due to pending enormous LCC expansion, which will require US Airways to further increase revenues and cut costs to return to sustained profitability.

Regards,

Chip

P.S. By the way, with Southwest no longer a threat to enter Pittsburgh in the near-term, I believe Allegheny County will have less leverage in its negotiations with US Airways and the opportunity for the airline to cut its Pittsburgh costs and keep the hub in operation just increased.