WSJ: WN's upgraded growth plan sends US airline stocks down

[WorldTraveler]

Ten years ago WN was not in Atlanta but it is now our eight biggest city.
Ten years ago delta dehubbed DFW.

Delta ran from the completion not WN.

 
 

How about you list all these delta markets that WN left.
And I don't want to see you list AirTran routes that were served with a hub and spoke system that WN would never fly as feeder routes.

DL left because of a failure to gain sufficient market share against AA at DFW, not WN.

and DL redeployed its assets from DFW to NYC where it gained far, far more in local revenue than it could have possibly carried from DFW.

DL's increased revenue in NYC local revenue ALONE over the past 10 years since DFW was closed as a hub is more than 6 times what it lost in local revenue adjusted to 2014 revenue in the combined DAL/DFW market which itself has grown esp. with the reopening of DAL to long haul flights.

DL's closure of DFW as a hub and redeployment of assets to NYC was absolutely the right strategic thing to do.

and DL has far eclipsed AA in NYC; the competitive battle was between AA and DL at DFW and DL changed the dynamic to win in the largest market in the US.

and there is no arguing that WN has walked away from more markets in ATL that are far larger than any markets that DL has walked away from and WN entered. You are the one that needs to list markets if you want to make that charge. The list of markets that WN has left from ATL alongside the markets that it has entered is far longer on the exited markets side.

As much as you want to believe otherwise, WN tries to directly compete as little as possible with legacy carriers.

 

[WNMECH]

You made the claim, you list the markets WN has left.
And don't include any feeder routes that AirTran had to keep their hub and spoke system alive.
WN disposed of the 717s and redeployed their 737s to point to point cities that fit the Southwest route system.
AirTran was only profitable because of their bag fees but WN took their aircraft and put them on profitable routes.

You claim Delta closing its DFW hub was redeployment and a smart move.

When WN has to really redeploy because of the change from hub and spoke to point to point flying, you call it running from competition.

You are clearly the hypocrite here.

Still waiting for all those delta markets WN left.

 

[WNMECH]

DL left because of a failure to gain sufficient market share against AA at DFW, not WN.




As much as you want to believe otherwise, WN tries to directly compete as little as possible with legacy carriers.

1. I never said who they ran from (but WN is in that same market) they just ran.

2. I guess you never heard our progress in Denver.

3. Going from zero Atlanta flights to it being our eight biggest city, is called expansion.

Still waiting for that huge list of Delta markets WN left.
Then we can compare them to how many markets out of DFW Delta ran from.

 

[WorldTraveler]

As much as you and your little mechanic buddy want to believe otherwise, FL was a wholly owned subsidiary of WN for several years. the markets that FL dropped WERE WN markets.

WN didn't separate its financial reports to show what revenue came from FL and what came from FL.

The operating carrier concept is no more valid for WN to use than it is to say that a market isn't a DL market because it was operated by a Delta connection carrier.

The combined FL/WN operation in Atlanta is smaller than it has been for years.

WN cut capacity.

No one has argued that WN couldn't redeploy capacity and hasn't done that. But if you want to say that DL runs from the competition in N. Texas, then you are going to be held to the same standard in ATL

and if DL was running from AA, then they more than gained it back in NYC. The same cannot be said about WN's retreat from ATL.

If anything, DL's pulldown of DFW as a hub simply set in place WN's growth which has also been targeted at AA.

 

[WNMECH]

So you can't list any Delta markets that WN left due to competition even though you say it over and over again?


You made the claim.
Just you bloviating more doesn't prove anything.
Put up or shut up.

 

[WorldTraveler]

yes, WN has or will drop markets from ATL that it started with its own aircraft - not FL's - since you can't admit that FL WAS indeed part of WN.

AUA, SJU, MBJ, BDL, and NAS were ALL operated by WN from ATL on its own aircraft post 1/1/2015 and are being pulled.

WN even had the audacity to put a billboard on the downtown connector in ATL(I75/85) seven lanes wide on each side touting their SJU service only to cancel it within months after starting it.

Yes, WN has pulled out of ATL markets which it operated on its own aircraft on top of what FL operated and you can't admit were really WN markets.

I have no problem with WN's need to redeploy assets in order to grow its network in Texas. That is exactly what Wall Street analysts want WN to do.

My problem is with you being unable to acknowledge that the reason why those markets were dropped - whether by FL or WN on its own metal - is because WN is not capable of dominating competitive markets like you think they can.

WN operates more of its markets with no direct nonstop competition than any of the other big 4 carriers - AA, DL, or UA.

The reason why WN has not fared well either in ATL against DL or US in PHL is because when those carriers have comparable cost structures, those legacy carriers attract the premium revenue and WN cannot undercut them.

WN's business model is based on operating in markets that it can dominate to the greatest extent possible. its Latin America expansion will almost entirely be from airports where it does not have to compete with legacy carriers, just as is happening at DAL.

The only bloviating is you being unable to admit that WN execs know they can't compete and succeed against legacy carriers today.

Wall Street knows it too which is why Wall Street expects WN to fund its growth by cancelling poor performing markets and not growing capacity. WN's stock price since its announcement has been punished by Wall Street accordingly.

DL and UA, who are not involved in the N. Texas shootout, have fared better than AA and WN stock.

you just haven't been able to figure it out.

I almost forgot about ATL-SFO which ends later this year.

WN aircraft today... not by the end of the year.

Wanna see the list of SLC markets that WN has ended over the past 6 years:

ABQ, BOI, GEG, PDX, RNO, SEA, STL

WN's seats at SLC will be down by 33% this summer compared to 6 years ago - when DL/NW merged.

 

[eolesen]

WN Mech, you obviously don't understand Airline 205:

1) DL's closing feeder routes out of DFW, MEM & CVG = strategic

2) WN's closing feeder routes out of ATL = running from the competition

 

[WorldTraveler]

first of all, MEM and CVG aren't because of competitive issues because they were the only hub carrier there.

second, you struggle as bad as he does in admitting that DL redeployed its DFW HUB assets to NYC and increased by 6X the amount of local revenue keeping share and revenue constant between the DFW hub pulldown and NYC buildup.

and third, I have never denied that DL didn't make strategic decisions which included running from AA's DFW hub. Never have I said that.

wnmech and others have repeatedly tried to argue that WN hasn't run from the competition even though they have built up DAL.

If they built up DAL without pulling down ATL and SLC, they could make that claim.

but since that is precisely what WN did - which isn't any different from what DL did at DFW - then WN did in fact run from the competition.


but let's also be clear that DL left DFW as a hub and more than gained from the very same airline - AA - in NYC what it lost at DFW.  WN won't do that with pulling down ATL and building up DAL

WN might or might not end up with the same revenue gain at DAL as DL has seen in NYC.

or they might not.

but there won't be any WN aircraft flying ATL routes by the end of this year that were started on WN aircraft earlier this year.

and the list of SLC markets that WN has pulled out of is just as long.

WN has indeed run from DL competition.

 

[does this plane go to paris]

The definition of insanity is contantly doing the same thing and getting the same result.  Argue with an idiot and you get idiotic responses.
 
While I have a certain someone on IGNORE, reading the posts and snippets, I get the drift.  Someone must be on another rant and rave that WN closed cities therefore they ran from competition.  I tried pointing out that when Delta bought Western, Delta has turned SLC into a haven for SkyWest regional jets and I got a lesson how how LUV closed 18 cities.  I learned my lesson.  I put them on IGNORE and read other forums where they kicked someone off boorish behavior.
 
Put him on IGNORE and you don't give them an opportunity to show their lunacy.

 

[WorldTraveler]

the reason why you can only ignore me is because you refuse to accept that DL has managed to maintain its share in SLC despite WN and a bunch of other carriers coming and going. WN is smaller in SLC than it has been in years.

in ATL, WN bought FL and has been systematically dismantling FL's operation. There are still a half dozen cities that WN served with its own aircraft on Jan 1, 2015 that have lost or will lose service before the year is up.

Again, I fully get the concept that WN can choose to redeploy assets in order to maximize its profits. DL did the very same thing with DFW.

The difference is that you and WN fans can't admit that WN can't compete nearly as effectively against DL as it can against other carriers and is therefore pulling down.

You and others throw the insane argument out despite the fact that DL took its assets from DFW where it could not compete against AA's size and redeployed them to NYC where DL has dramatically grown and is significantly larger than AA.

the reason why you and others throw up your hands in frustration is because you cannot accept the basic facts of what has happened and can't admit that I am indeed right about the industry - including that WN chooses not to compete against DL if given the option to compete against AA and UA, which have higher costs than DL.

The insanity comes from being unable to accept basic facts of the industry which drive very rational behavior.

Specific to the issue of competitiveness, airlines are more likely to compete with a carrier that have higher cost structures because they have a better chance of winning.

that is exactly what WN has done.

it also is why WN's stock price is not near the value it once was relative to the legacy carriers, in large part because DL has the lowest cost structure of the big 3 and also has the greatest ability to generate premium revenues.

a smaller cost advantage and a larger premium revenue gap is the last thing that a company wants to face in trying to build its business.

WN has chosen to reduce its competitive presence in key DL markets and widen it in key AA and UA markets.

 

[robbedagain]

WN  how many flights does WN have currently at ATL?  and are they planning on expanding their operations?

 

[FWAAA]

Currently, about 125 peak daily departures to 39 cities. Dunno if any expansion is planned.

 

[WorldTraveler]

WN's schedule for Jan 2016 (one year after the ATL operation became all WN) is for an average of 108 flights/day from ATL.

AUS, DEN, BWI, PIT, SAN, and PHX are the only cities that will have the same schedule for Jan 2016 vs Jan 2015.

in addition to the cities which WN is eliminating from ATL, they will reduce frequencies in 26 additional cities and add flights in 7 cities... CMH, OAK, LAS, OAK, TPA, DAL, and OKC, although none of those cities are increasing flights by a full additional flight/day.. ie DAL and OKC are just one additional flight/week.

Jan is fairly far out for WN - their last booking date is Jan 4, 2016 - so they could make further changes.

 

[robbedagain]

thanks FWAA

 

[WorldTraveler]

airline stocks racked up strong gains today after WN said it would back off its plans for 8% capacity growth and return to its previously planned 7% capacity growth plan.

http://www.streetinsider.com/Corporate+News/Southwest+Airlines+(LUV)+to+Cap+Seat-Capacity+Growth+at+7%25,+Says+CEO/10612621.html