Whats wrong with building the company the old fashion way?

[InternationalDan]

Why cant US airways build the company the old fashion way, by adding routes.
Adding Planes, adding employees attracting more customers, and building this business like every other buisness does in this great country of ours, what is the fixation on merging themself into mega oblivian. They need to take a lesson from other airlines that have built there business over the last 10 years by adding routes, adding planes, and attracting customers...3 airlines come to mind, JetBlue, Airtran and Southwest. Southwest is now the largest airline and they did not become the largest airline because of merging, if customers are taken of, and the business is grown properly, there is no need for a merger...


Dan

 

[Poug Darker]

Why cant US airways build the company the old fashion way, by adding routes.
Adding Planes, adding employees attracting more customers, and building this business like every other buisness does in this great country of ours, what is the fixation on merging themself into mega oblivian. They need to take a lesson from other airlines that have built there business over the last 10 years by adding routes, adding planes, and attracting customers...3 airlines come to mind, JetBlue, Airtran and Southwest. Southwest is now the largest airline and they did not become the largest airline because of merging, if customers are taken of, and the business is grown properly, there is no need for a merger...
Dan

Routes to where? Other airlines mega-fortresses? EAS routes? The 65 or so LUV destinations in the US?
Adding planes costs money. Where is that coming from? Investors don't want to participate, banks just say no, and aircraft manufacturers can't any more.
JB got free airplanes for 5 years. LUV gets preferential treatment everywhere they go.
So, assuming you can get the airplanes, and figure out the routes, how do you compete with airlines with fat bank accounts that amount to war chests.
In the current environment, if you can slow grow over 25 years (and survive) your plan may work. The surest way to grow quickly with guaranteed market share and save money via efficiencies of less redundancy is to merge. The biggest challenge in that strategy is finding the right partner.
Cheers.

 

[usa1]

http://charlotte.bizjournals.com/charlotte/stories/2010/05/03/daily12.html?ana=yfcpc

 

[InternationalDan]

War Chest? They are all broke, they need money, It is a fact that all the planes going to MCO are full, why cant they add more flights there? trying to nonrev to Florida is a quest as it seems now. If they add more flights down south that would be a big money maker....How about the carribean, most nonstop flights are from CLT how about some other cities with more passenger totals? Lets take a look at the west coast, if you want to fly from LAX to SFO how do you get there? through PHX, how about some flights like that, maybe LAX-SEA, LAX-SFO without going through PHX, southwest does all that and more, and there planes are full, no I dont work for them I work for US, start small and grow, a little at a time, not jump in a big hole and try to get out, but start at the shallow end and gradually go deeper...


Dan

 

[N965VJ]

It is a fact that all the planes going to MCO are full, why cant they add more flights there? trying to nonrev to Florida is a quest as it seems now. If they add more flights down south that would be a big money maker....

Full flights do not equal profitability.

 

[Travelpro72]

As I mentioned in another thread US should merge with Jetblue to create a larger domestic footprint which will help feed current and future international destinations. Seems logical to me.

 

[strangiatotheme]

Lets take a look at the west coast, if you want to fly from LAX to SFO how do you get there? through PHX, how about some flights like that, maybe LAX-SEA, LAX-SFO without going through PHX, southwest does all that and more, and there planes are full, no I dont work for them I work for US, start small and grow, a little at a time, not jump in a big hole and try to get out, but start at the shallow end and gradually go deeper...

How do you get between those cities? You fly an airline that is able to operate those segments efficiently. US can't exist to connect everyone everywhere all the time, and having a few odd P2P routes in over-saturated markets often detract from the bottom line of any hub-oriented carrier.

 

[rvolkcpa]

War Chest? Lets take a look at the west coast, if you want to fly from LAX to SFO how do you get there? through PHX, how about some flights like that, maybe LAX-SEA, LAX-SFO without going through PHX, southwest does all that and more, and there planes are full, no I dont work for them I work for US, start small and grow, a little at a time, not jump in a big hole and try to get out, but start at the shallow end and gradually go deeper...


Dan

US offers LAX to SFO service on United via codeshares. It wouldn't make sense to compete with a fellow STAR carrier, as well as a number of other carriers, on a route like this. US needs to maximize the potential of the alliance by taking UA/CO passengers to destinations that those carriers don't serve.

US also needs to get inflight entertainment back on longer flights. On our flight from SEA-PHL on Saturday, I talked to a guy across the aisle who was visiting his parents and said this was his least favorite flight because it meant 5 hours with no entertainment. US needs to gradually improve its product to be fully competitive with other carriers. In January when we flew EWR-SEA on CO, the Direct TV for $8 made the trip go by quicker. AS doesn't have Direct TV, they do offer the option of DigiPlayer. Another AS touch is serving Cougar Mountain Cookies on long distance flights. Most of our flights on US have been good experiences because of great flight crews, but adding some amenities would have made them even better.

 

[SS255]

I think that building US the old fashioned way is an excellent idea. Look at the smaller regional carriers like B6 and AS. They are not trying to be global behemoths, yet they have strong brands and relatively satisfied customers.

If US can focus on improving customer service and employee relations, it would go a long way in turning around the negative perception which people have of this airline (rightly or wrongly). It's not too late.

 

[phasersonstun2]

Me thinks we need to exit the Star Alliance ASAP, since the Smisek ugly girl has no partner at that dance hall.

LCC is now the laughing stock of the industry (again).

The Star Alliance doesn't need LCC at all now and would relegate it to feeder status. The writing should be all over the walls and ceiling... the ugly girl needs to find a new dance hall.

 

[Travelpro72]

Someone had mentioned US needing a "celebrity makeover". They sure do. US needs to fix the mess and build off it's strengths. I say go after Jetblue after that.

 

[700UW]

With US #2 or 3 at LGA and B6 as large as they are at JFK a merger would never pass the DOJ/DOT, just look at how they rejected the slot swap now.

 

[Travelpro72]

I just did a 4day with plenty of flights in and out of LGA. It certainly looks like DL and AA have a pretty big presence in LGA while holding down sizeable hubs across town at JFK.

 

[700UW]

The top carriers are: American Airlines (19.76%), Delta (16.21%), US Airways (8.88%) and United (7.05%). at LGA

By passengers carried, the five largest airlines at JFK are:[48]

JetBlue Airways (25.5%)
Delta Air Lines (including the Delta Connection carriers) (21.9%)
American Airlines (including American Eagle) (16.7%)
British Airways (2.8%)
Air France (1.9%)

 

[FWAAA]

Why cant US airways build the company the old fashion way, by adding routes.
Adding Planes, adding employees attracting more customers, and building this business like every other buisness does in this great country of ours, what is the fixation on merging themself into mega oblivian.

Unfortunately for the employees of the legacy airlines, the time for adding planes and routes has passed. The decades of the Eighties and Nineties offered high-cost legacy airlines about twenty years to grow to fill the demand as deregulation caused air travel to boom, aided by low fuel prices (by today's standards). You also had twenty years to adapt and change instead of holding onto yesterday. Problem is, the legacies and their employees grew without any real adaptation and change, leading to numerous bankruptcies during the last decade.

They need to take a lesson from other airlines that have built there business over the last 10 years by adding routes, adding planes, and attracting customers...3 airlines come to mind, JetBlue, Airtran and Southwest. Southwest is now the largest airline and they did not become the largest airline because of merging, if customers are taken of, and the business is grown properly, there is no need for a merger...

Funny that you posted the three major airlines that grew like gangbusters during the previous decade but don't seem to understand what they have in common: LOW COSTS. US employees are somewhat low-paid but still work for an airline that has high costs (compared to the true LCCs). The reason that the true LCCs grew is that they offer what customers apparently want, and fewer customers want what your dumpy airline has to offer. Customers don't seem to want what any of the dumpy legacies have to offer, and all of them have shrunk during the past decade. Some have merged in a desperate effort to stave off the inevitable. After the mergers, the new entities tend to shrink and continue to shrink. With oil near $85/bbl, the total air travel market is not going to grow. If oil goes even higher again, the total air travel market will shrink some more. The true LCCs will probably grow some as the legacies continue to shrink, but the total won't grow. USA air travel is a mature market with no real room for growth unless oil falls to its late eighties/nineties levels (which were almost free oil compared to today).

Notice that even B6, FL and WN have slowed their growth in recent years as oil prices spiked and then the economy crashed. In the old days, WN would be growing to take market share from the legacies. For the early part of the last decade, B6 grew far too fast and nearly ended up bankrupt until Barger took over and LH bailed B6 out with a loan.

It boils down to this: Low cost airlines look to be the growth area and high cost airlines (including US) will probably continue to slowly shrink. Not a pretty sight.