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FrugalFlyer
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On 6/1/2003 7:38:59 PM geo1004 wrote:
PHL to FCO is US''s best transatlantic. It ain''t going anywhere. That Rome flight is full all the time and won''t be outsourced to LH or anyone else soon.
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On 6/1/2003 7:38:59 PM geo1004 wrote:
PHL to FCO is US''s best transatlantic. It ain''t going anywhere. That Rome flight is full all the time and won''t be outsourced to LH or anyone else soon.
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Even if a flight is full it doesn''t mean its making money.
Look at how many flights UA-LH offer between their hub(s). UAL trans-atlantic is mostly to LHR and FRA from their United States hubs. Look at AC, another * allliance airline, trans-atlantic service - reduced to mostly Canada-LHR and Canada-FRA. Look at how the KL/NW alliance is working. NW has multiple flights to AMS from DTW and MSP plus toss in the token DTW-CDG/LGW flight. It makes money for NW/KL to operate this way. Sure NW may operate a few AMS-USA non-hub flights with their DC-10s, but don''t look for LH to give something like FRA-BOS to US Airways. In the end, if an additional flight from PHL or PIT or CLT to FRA is more beneficial for *, then you can be pretty certain that US will move an airplane from PHL-FCO to be used on another PHL or PIT or CLT - FRA flight.
Whatever transatlantic routes US ends up flying, membership in the * alliance is still good news for US.
ITRADE
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On 6/1/2003 9
51 PM FrugalFlyer wrote:
Even if a flight is full it doesn''t mean its making money.
On 6/1/2003 9
51 PM FrugalFlyer wrote: ----------------
On 6/1/2003 7:38:59 PM geo1004 wrote:
PHL to FCO is US''s best transatlantic. It ain''t going anywhere. That Rome flight is full all the time and won''t be outsourced to LH or anyone else soon.
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On 6/1/2003 7:38:59 PM geo1004 wrote:
PHL to FCO is US''s best transatlantic. It ain''t going anywhere. That Rome flight is full all the time and won''t be outsourced to LH or anyone else soon.
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Even if a flight is full it doesn''t mean its making money.
I''m told that FCO does make money. US would like to grab additional Italy exemptions.
Cosmo
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ITRADE:
The U.S.-Italy market is governed by an Open Skies bilateral agreement now, and it has been for a couple of years. So US (or any other U.S. or Italian carrier) can fly from any U.S. city to any Italian city without any frequency restrictions. Thus, IMHO if US really wanted to add another U.S.-Italy route (most likely PHL-MXP), it could have, and probably would have, done so already.
The U.S.-Italy market is governed by an Open Skies bilateral agreement now, and it has been for a couple of years. So US (or any other U.S. or Italian carrier) can fly from any U.S. city to any Italian city without any frequency restrictions. Thus, IMHO if US really wanted to add another U.S.-Italy route (most likely PHL-MXP), it could have, and probably would have, done so already.
How do antitrust exemptions work in global airline alliances? Will US need to apply to DOT for an exemption to work with each of the alliance members or would one catch-all exemption apply?
I''m no lawyer, but as far as I know, antitrust law bars any airline from coordinating any sort of pricing or routing decision with its partners. So, even if it made sense for the Star Alliance to demand that US give up, say, PHL-MAD and route everyone PHL-FRA-MAD on LH, it wouldn''t be legal without an antitrust exemption.
I doubt that the transatlantic service will vanish or even shrink for two reasons (one firm, one hunch):
1) A customer who is forced to double-connect to get to major European destinations other than FRA and MUC will choose a single-connect option like DL or AA or CO, depriving Star of any of his revenue.
2) Someone more familiar with US''s current contracts and how they compare to other Star carriers would know better, but my hunch is that given the concessions, US''s cost to run a 330, for instance, between the US and Europe has to be less than LH''s. Even if it was legal, there really wouldn''t be much incentive for Star to demand that US drop its less-costly flights in favor of LH''s more-costly flights.
I''m no lawyer, but as far as I know, antitrust law bars any airline from coordinating any sort of pricing or routing decision with its partners. So, even if it made sense for the Star Alliance to demand that US give up, say, PHL-MAD and route everyone PHL-FRA-MAD on LH, it wouldn''t be legal without an antitrust exemption.
I doubt that the transatlantic service will vanish or even shrink for two reasons (one firm, one hunch):
1) A customer who is forced to double-connect to get to major European destinations other than FRA and MUC will choose a single-connect option like DL or AA or CO, depriving Star of any of his revenue.
2) Someone more familiar with US''s current contracts and how they compare to other Star carriers would know better, but my hunch is that given the concessions, US''s cost to run a 330, for instance, between the US and Europe has to be less than LH''s. Even if it was legal, there really wouldn''t be much incentive for Star to demand that US drop its less-costly flights in favor of LH''s more-costly flights.
FrugalFlyer
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On 6/3/2003 2:31:08 PM DCAview wrote:
How do antitrust exemptions work in global airline alliances? Will US need to apply to DOT for an exemption to work with each of the alliance members or would one catch-all exemption apply?
I''m no lawyer, but as far as I know, antitrust law bars any airline from coordinating any sort of pricing or routing decision with its partners. So, even if it made sense for the Star Alliance to demand that US give up, say, PHL-MAD and route everyone PHL-FRA-MAD on LH, it wouldn''t be legal without an antitrust exemption.
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On 6/3/2003 2:31:08 PM DCAview wrote:
How do antitrust exemptions work in global airline alliances? Will US need to apply to DOT for an exemption to work with each of the alliance members or would one catch-all exemption apply?
I''m no lawyer, but as far as I know, antitrust law bars any airline from coordinating any sort of pricing or routing decision with its partners. So, even if it made sense for the Star Alliance to demand that US give up, say, PHL-MAD and route everyone PHL-FRA-MAD on LH, it wouldn''t be legal without an antitrust exemption.
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I''m no lawyer either, and if I''m mistaken somebody will correct me, but wouldn''t US ask for immunity in order to co-ordinate schedules and pricing with LH? I don''t know if US needs to get anti-trust immunity for all of the * alliance. UA-US code-share is already in effect, LH is the key airline to code-share on in Europe. OS, SK, bmi, LOT are small potatoes (how big/important is the CLT-CPH or PIT-WAW or PHL-VIE market?). I guess a code-share with AC would fit in nicely in North America. That way US-LH code-share covers Europe, US-UA/AC covers the rest of North America and connects Asia. Unless Varig/ANA/Thai, etc. want to serve PIT/CLT/PHL then all US needs is permission for participation in FF programs.
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1) A customer who is forced to double-connect to get to major European destinations other than FRA and MUC will choose a single-connect option like DL or AA or CO, depriving Star of any of his revenue.
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I disagree for the following reasons: 1) A customer who is forced to double-connect to get to major European destinations other than FRA and MUC will choose a single-connect option like DL or AA or CO, depriving Star of any of his revenue.
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1) A KL/NW pax has to go from their spoke airport to DTW/MSP to AMS to European city - unless it is LGW or CDG which NW still serves directly from their hubs.
2) I thought that was the purpose of global alliances. Instead of an airline serving a number of cities on a continent, it can fly the pax to the partners hub where the partner airline will take them the remainder of the way.
3) The only way an airline offers service to smaller European centers (in addition to London and Paris) is because that airline has a hub in a large city and there is a market for it. AA has JFK and ORD to Europe. UA has IAD/ORD to Europe. DL has JFK to Europe. From these cities there is money to be made flying to "secondary" European cities. US does have a large presence in NYC and Washington but unfortunately can''t do transatlantic from LGA or DCA.
4) Even airlines such as DL and AA are now trying to offer more flights via code-share on their partner airlines out of CDG and LHR respectively. FRA and MUC are quite nicely located geographically to offer connecting service to most cities in Europe - except for LGW, CDG, MAN and DUB which US should continue to fly to direct.
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2) Someone more familiar with US''s current contracts and how they compare to other Star carriers would know better, but my hunch is that given the concessions, US''s cost to run a 330, for instance, between the US and Europe has to be less than LH''s. Even if it was legal, there really wouldn''t be much incentive for Star to demand that US drop its less-costly flights in favor of LH''s more-costly flights.
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2) Someone more familiar with US''s current contracts and how they compare to other Star carriers would know better, but my hunch is that given the concessions, US''s cost to run a 330, for instance, between the US and Europe has to be less than LH''s. Even if it was legal, there really wouldn''t be much incentive for Star to demand that US drop its less-costly flights in favor of LH''s more-costly flights.
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I''m of the opinion that even though PHL-FCO or PHL-Whatever may make some money, once US is fully integrated into *, it may become more profitable to take that aircraft off that route and fly to a * hub. Not just for * but for US.
And I don''t think right now US is in a good position to really negotiate from a position of strenght (or should I say US doesn''t have the leverage) to dictate where and how it best fits into *.
