Some more "yield pressure" for Delta in ATL

[Hope777]

Who cares who is worried!!! IT STILL EFFECTS THE BOTTOM LINE and dilutes revenue

 

[WorldTraveler]

uh... WN's yields are being diluted by offering a buy 3 get one free promotion, not DL's.

DL revenue manages its economy basic fare just like every other fare product.

the yield pressure is on WN because they do not have a schedule competitive with what DL offers so they have to discount to fill seats.

 

[topDawg]

Who cares who is worried!!! IT STILL EFFECTS THE BOTTOM LINE and dilutes revenue

Clearly it doesn't. 
AA and DL would be doing something about it if it was a drag on the bottom line. For the most part they don't even seen to notice NK is there. 

 

[WorldTraveler]

Wrong
DL does care about NK which does have about 10% of the local DTW and MSP local pax share
DTW DFW and MSP are all single carrier hubs and no legacy hub is free from LCC or ULCC presence
The problem in DFW is that AA let NK grow to 10% of the market and now has WN too

The only legacy hub with 10% or more for the LCC and ULCC is DEN which is a pricing and profitability disaster

 

[jcw]

Exactly everyone on the board needs to get with the program DL faces no challenges

 

[WorldTraveler]

No DL just manages the challenges

 

[N628AU]

Let me get this straight WT.  WN expansion at DAL will harm AA at DFW (as you have stated ad nausem), but their cost structure will not allow them to take a bite out of DL at ATL?  I just want to make sure which side of your mouth we all need to listen to on this one.

 

[WorldTraveler]

as usual, you and others don't get it right.

the reason why WN can't make ATL work is the same reason they couldn't do it at PHL... they are competing on a point to point basis against a hub carrier that has far more frequencies in the same market and who has a lot of connecting passengers that help fill planes.

there is virtually no examples of 2 carriers in the same market getting similar shares when one of them has significantly less service than the other. WN simply does not have the schedule to compete directly against DL or any other legacy carrier.

At DAL, AA is competing from a separate airport so that they can provide enough differentiation in the service to attract passengers. further, WN does connect passengers at DAL and they also offer far more destinations and seats than they do in ATL. further, much of WN/FL's current share in ATL is attributable to FL's presence which just wound down.

The whole reason why WN is now pushing their marketing campaign is because it is becoming apparent that the FL traffic bump is gone and WN's flights are not as full anymore.

the only one who is confused about what is going on is you... well maybe you have company. in fact, based on what other people say, you do.

 

[topDawg]

Wrong
DL does care about NK which does have about 10% of the local DTW and MSP local pax share
DTW DFW and MSP are all single carrier hubs and no legacy hub is free from LCC or ULCC presence
The problem in DFW is that AA let NK grow to 10% of the market and now has WN too

The only legacy hub with 10% or more for the LCC and ULCC is DEN which is a pricing and profitability disaster

Um no not wrong. Again, we all know you live in this bat **** crazy world of Delta can do anything but in the real world DL doesn't worry about NK. 
 
 
But if they do, just give us one example of Delta price matching, giving out SkyMiles or adding capacity in a market from MSP or DTW because of NK. 

 

[WorldTraveler]

if DL didn't care about NK, they wouldn't have implemented Economy Basic which is DIRECTLY targeted to NK which is DL's largest competitor in both MSP and DTW.

you clearly don't understand revenue mgmt. because DL doesn't have to flood a market with capacity in order to increase its competitive pressure on NK. that type of strategy is what NW did.

DL's strategy is to marginally upgauge a few flights, increase the amount of inventory available in fare classes that are competitive with NK, and increase the attractiveness of DL to the market by offering a wider range of fares with more reliable service than anything NK can offer.

whether you understand the principle - and you have proven over and over that you don't understand revenue mgmt. - DL is absolutely concerned about NK's growth and in making sure that they take their growth strategies elsewhere.

for you to believe that DL gives any competitor a free pass is an admission of how little you really understand the way the 4th and 5th floors work.

 

[topDawg]

if DL didn't care about NK, they wouldn't have implemented Economy Basic which is DIRECTLY targeted to NK which is DL's largest competitor in both MSP and DTW.

you clearly don't understand revenue mgmt. because DL doesn't have to flood a market with capacity in order to increase its competitive pressure on NK. that type of strategy is what NW did.

DL's strategy is to marginally upgauge a few flights, increase the amount of inventory available in fare classes that are competitive with NK, and increase the attractiveness of DL to the market by offering a wider range of fares with more reliable service than anything NK can offer.

whether you understand the principle - and you have proven over and over that you don't understand revenue mgmt. - DL is absolutely concerned about NK's growth and in making sure that they take their growth strategies elsewhere.

for you to believe that DL gives any competitor a free pass is an admission of how little you really understand the way the 4th and 5th floors work.

Its the same thing Delta has been doing too. You even say so. 
 
as it is, Delta is not worried about NK. Delta added the basic economy fare to help with costs in big VFR and tourism markets. There are plenty of markets that one of the ULCCs are in that Delta doesn't offer that fare class. 
 
And I didn't say they give them a "free pass" but Delta isn't worried about less than 10 daily flights in Atlanta on an airline they can't compete with profitably. United and American are in the same boat. 

 

[WorldTraveler]

If you are speaking only about ATL, then NK is not the threat that it is in DTW or MSP, but NK absolutely does matter to DL in every market. The reason why DL is more susceptible to NK in DTW and MSP is because there is no LCC. but given the size of WN's cuts in ATL and the increase in their fares, NK sees an opportunity for the low value passenger.

remember that NK almost always starts a market with just one flight a day or less which is what they are doing in several new ATL markets including BOS and MCO and others. but when they fill that flight, they add another. that is what has happened in DFW - and in some DTW and MSP markets. and when you have more than one flight in a market, you do grow much faster in terms of ability to pull passengers.

Basic Economy has nothing to do with DL's costs... DL is very good at matching capacity to demand and not carrying unnecessary costs. Basic economy is about adding a fare point to allow DL to compete with the ULCCs.

You can pull a fare extract in every market and tell me where DL does or doesn't have fares but I suspect you will miss them.... and I can also assure you that DL is competitive. Given that we are now in peak spring break period, DL is offering very few deep discounted fares in any market... they don't need to. There will always be a certain amount of very low fare passengers that ULCCs can pick up because they move their planes in and out of markets... but DL will be competitive with carriers that are in DL markets on a sustained basis.

and no I didn't say that DL is flooding any market competitive with NK.

the most significant location that DL is adding capacity is in SEA and west coast markets where DL has clearly decided that a partnership with AS is not going to work and so DL must have a presence of its own. that has been discussed a million times.

btw, the Port of Seattle is doing more than its share of pushing for new and expanded facilities at SEA.

 

[topDawg]

If you are speaking only about ATL, then NK is not the threat that it is in DTW or MSP, but NK absolutely does matter to DL in every market. The reason why DL is more susceptible to NK in DTW and MSP is because there is no LCC. but given the size of WN's cuts in ATL and the increase in their fares, NK sees an opportunity for the low value passenger.

remember that NK almost always starts a market with just one flight a day or less which is what they are doing in several new ATL markets including BOS and MCO and others. but when they fill that flight, they add another. that is what has happened in DFW - and in some DTW and MSP markets. and when you have more than one flight in a market, you do grow much faster in terms of ability to pull passengers.

Basic Economy has nothing to do with DL's costs... DL is very good at matching capacity to demand and not carrying unnecessary costs. Basic economy is about adding a fare point to allow DL to compete with the ULCCs.

You can pull a fare extract in every market and tell me where DL does or doesn't have fares but I suspect you will miss them.... and I can also assure you that DL is competitive. Given that we are now in peak spring break period, DL is offering very few deep discounted fares in any market... they don't need to. There will always be a certain amount of very low fare passengers that ULCCs can pick up because they move their planes in and out of markets... but DL will be competitive with carriers that are in DL markets on a sustained basis.

and no I didn't say that DL is flooding any market competitive with NK.

the most significant location that DL is adding capacity is in SEA and west coast markets where DL has clearly decided that a partnership with AS is not going to work and so DL must have a presence of its own. that has been discussed a million times.

btw, the Port of Seattle is doing more than its share of pushing for new and expanded facilities at SEA.

Wow you just love seeing yourself talk don't you? What is it you just said to me in another thread?
"this thread is about NK and ATL" stay on topic glass house. 
 
As it is, Delta doesn't have the costs to compete with NK. I know in WT land Delta wins, but here in the real world Delta isn't worried about NK. They added basic economy in lower yielding markets but in general still don't even come close to the fares the ULCC offer. Matter of fact I haven't found one yet. 

 

[WorldTraveler]

DL doesn't have to have identical costs with every carrier to be able to compete.

you don't understand the way airline networks and costs work.

DL can compete where it needs to because of revenue mgmt.

Your assumption that DL doesn't care about NK is flat out wrong

I told you why you will see fewer Basic Economy fares right now. when flights to Florida are full and the NE is shut down in part every week due to weather, it makes little sense to offer fares that low

By your "DL doesn't have the costs to compete with NK" statement, DL shouldn't be trying to compete with AS since they have lower costs.

You should send Richard a note. He didn't realize he was trying to build a hub in a lower cost competitor's backyard.

and you thought that competing with 10 flights/day from ATL is something DL can't do.

 

[N628AU]

Less than two weeks later it appears Frontier will be adding service in ATL too.

Announcement to come tomorrow per atlantaga.gov. The mayor will be on hand to be prt of the announcement.