Any "Latest & Greatest" about Delta?
06-02-2011, 01:32 PM
Happy to be here
Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
There are limits in the agreement on competing routes. We effectively capped all of their other code share agreements when we signed ours a few years back. The is a compliance window, and then a recourse clause. (as it has been explained to me)
06-02-2011, 01:42 PM
Can't abide NAI
Joined APC: Jun 2007
Position: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Posts: 12,014
Here's the test. Who has a Paris or Brussels overnight?
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
- Good to meet you, please leave the area, or
- HEY GUYS IT'S A DELTA PILOT, GET THIS MAN A BEER, GET THE GIRLS OVER HERE and excuse me Captain, would you like to come have a seat in our press box? Hope you don't mind the Champagne ... now her name is Sylvire' and this is Adrienne...
06-02-2011, 01:54 PM
Gets Weekends Off
Joined APC: Dec 2007
Posts: 374
Here's the test. Who has a Paris or Brussels overnight?
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
- Good to meet you, please leave the area, or
- HEY GUYS IT'S A DELTA PILOT, GET THIS MAN A BEER, GET THE GIRLS OVER HERE and excuse me Captain, would you like to come have a seat in our press box? Hope you don't mind the Champagne ... now her name is Sylvire' and this is Adrienne...
06-02-2011, 02:04 PM
Moderator
Joined APC: Oct 2006
Position: B757/767
Posts: 13,088
Can't Call Southwest a Discount Airline These Days - WSJ.com
Southwest Airlines Co., the king of low fares, is feeling its crown slip.
High fuel prices, the end of lucrative fuel hedges and a changing route network have led Southwest to push its prices up dramatically, faster than many other airlines. With last-minute fares of more than $1,000 round-trip in long-haul markets, some nonrefundable fares over $900 and average prices in some markets higher than competitors, it's hard to call Southwest a "discount" carrier anymore.
Southwest's average ticket price has jumped 39% in the past five years, while the average ticket price for domestic trips for the industry was up 10%, according to the Department of Transportation.
That's led to more markets where Southwest is sometimes higher priced than rival airlines. Between Baltimore and Oakland, Calif., a route where Southwest carries 73% of all passengers, Southwest's average ticket was $232 in the fourth-quarter last year, up a hefty 63% from $142 in the same period of 2005, according to government data. The second-largest carrier on that route was Delta Air Lines Inc., which averaged $166 in the fourth quarter last year, or 28% less than Southwest.
Need to go from Boston to Los Angeles at the last minute? Southwest recently offered one-way, connecting flights for next-day travel at $523. US Airways Group Inc. offered connecting flights the same day at $320. AMR Corp.'s American, jetBlue Airways Corp. and Virgin America Inc. all had non-stops at $534.
The Middle Seat Terminal
More Seats for Flights to Europe
Southwest says prices are higher than the airline would like—a consequence of high fuel prices. The company has remained profitable, unlike so many other airlines, and passenger traffic has been growing. But the airline recognizes there will be limits to how high it can go with fares.
"We don't like the fact that we have had to increase prices, but we absolutely would continue to hold out that we are America's leading low-fare airline," said Dave Ridley, Southwest's chief marketing officer.
One major reason Southwest prices can seem higher than competitors, he noted, is because Southwest doesn't charge fees to check baggage or penalties to change tickets. Check one bag for $25 each way and a Southwest ticket that is $50 higher than another airline may, in fact, cost the same.
"We're all-in, day in and day out," Mr. Ridley said. "We continue to maintain we are the best value in the air."
There are, of course, still many markets where Southwest is indeed the lowest-priced carrier, and many where Southwest has forced rival airlines to drop their prices. Historically, there have always been instances where other airlines had cheaper prices than Southwest for particular flights. But travelers and fare analysts say that as Southwest has pushed its prices higher, that's happening more often.
"Southwest is becoming more of a hybrid, catering more to the business traveler and acting more like a 'big' airline," said Robert Harrell, a consultant who tracks airfares weekly. An upside of higher airfares: They help business travelers earn more points in Southwest's revamped frequent-flier program, which entices people to pay higher prices to get bonus points.
Craig Seidel of Palo Alto, Calif., flies Southwest frequently between San Jose and Burbank for work and has seen one-way ticket prices go from $69 Wal-Mart levels to seemingly Nordstrom levels of double or triple the price.
Has "discount" carrier Southwest become just another big airline? It is now the most expensive airline in the U.S. on a cost-per-mile basis. Scott McCartney discusses how it is bumping up fares.
"It used to be so cheap it was almost like taking the bus. But now I seem to spend $400 on a round-trip ticket," Mr. Seidel said. "I feel more of a sticker shock on airline tickets than I do at the gas pump."
Southwest's lowest unrestricted fare between San Jose and Burbank is $371; a "Business Select" upgrade adds $30.
There have been structural changes in how Southwest prices tickets. Three years ago, Southwest doubled the number of fares it offers on any flight to 16 from eight. Shoppers don't see all those fares, but they are loaded into the airline's reservation system. As seats sell, the lowest price offered bumps up to a higher fare "bucket," as the industry calls the different price levels. The move puts Southwest's structure closer to other airlines, some of which employ two dozen fare buckets.
In many cases where Southwest has a higher price than competitors, it almost always had the lower price available for a time. But after tickets sold, its best offering moved to a more expensive fare bucket, Mr. Ridley said. With Southwest pricing, it almost always pays to shop early. It's rare when Southwest cuts the prices on seats at the last minute.
For a Phoenix-Los Angeles round-trip over the July Fourth weekend, for instance, US Airways, American and Delta all offered seats at $144 but Southwest's cheapest price for the same dates was $169. Mr. Ridley said Southwest offered the $144 price, but sold all the seats it wanted to at that level and so its lowest price became $169, while competitors still had seats at the lower fare.
And Southwest prices long trips with connections differently. While many airlines offer a discount if travelers are willing to endure the inconvenience of connecting flights instead of non-stop flights, Southwest still prices connecting trips more like two non-stops. Because Southwest doesn't operate massive hubs where most traffic is funneled, it often doesn't have as many connections to offer. With fewer seats, it can price higher.
In a connecting market like Albuquerque, N.M., to Providence, R.I., Southwest's average ticket was $246 in the fourth quarter, according to Bureau of Transportation Statistics data, while Delta averaged $204.
View Full Image
Getty Images
The end of Southwest's fuel hedges made the biggest change in pricing.
Mr. Ridley said there are other reasons for Southwest's larger-than-average price surge in recent years. Southwest has been adding longer flights, pushing its average ticket price higher simply because it is flying people farther, he said. The average distance of a passenger trip on Southwest rose 14% over the past five years.
In addition, as Southwest has expanded into big-city hub airports like Philadelphia, Boston, New York and Minneapolis, it has forced competitors to reduce fares in many more markets, helping to drive the industry average lower. Moving into bigger airports has slowed Southwest's operation some and pushed operating costs higher.
The end of the fuel hedges made the biggest change in pricing, however. For many years Southwest's fuel costs were significantly lower than rival airlines because Chief Executive Gary Kelly decided when prices were low before the U.S. invasion of Iraq to prepurchase fuel and buy hedges against higher prices.
Ticket to Ride
In a spot check of 24 markets for travel over the Fourth of July weekend, Southwest had the lowest prices in only 11
From Phoenix to Los Angeles round-trip, US Airways, American and Delta all offered nonstop flights at $144; Southwest was offering its seats at the same time at $169
Between Newark Liberty International Airport and Houston round-trip, Continental had seats on nonstop flights for $412 while Southwest's cheapest price was $486
Between St. Louis and San Francisco, American's lowest price was $399 and Southwest's lowest price was $430
Mr. Ridley pointed to fares in markets Southwest doesn't serve as evidence that his airline is still the low-fare enforcer. Before Southwest began flights to Greenville-Spartanburg, S.C., in March, the one-way unrestricted coach fare to Orlando was $830. After Southwest entered, it dropped to $206. Philadelphia went from $978 one-way to $290.
Or look at a market like Atlanta-Nashville, Mr. Ridley said, which only Delta services. The average fare in the fourth quarter was $152 for that 215-mile hop, while the average price for trips of similar length in Southwest markets was significantly less, such as $110 average for Baltimore-Pittsburgh tickets in the fourth quarter, according to DOT data.
As for the "discount" airline label, Southwest has never used it or wanted it because it can conjure notions of poor service. "We see ourselves as the low-fare leader," Mr. Ridley said.
Write to Scott McCartney at [email protected]
Southwest Airlines Co., the king of low fares, is feeling its crown slip.
High fuel prices, the end of lucrative fuel hedges and a changing route network have led Southwest to push its prices up dramatically, faster than many other airlines. With last-minute fares of more than $1,000 round-trip in long-haul markets, some nonrefundable fares over $900 and average prices in some markets higher than competitors, it's hard to call Southwest a "discount" carrier anymore.
Southwest's average ticket price has jumped 39% in the past five years, while the average ticket price for domestic trips for the industry was up 10%, according to the Department of Transportation.
That's led to more markets where Southwest is sometimes higher priced than rival airlines. Between Baltimore and Oakland, Calif., a route where Southwest carries 73% of all passengers, Southwest's average ticket was $232 in the fourth-quarter last year, up a hefty 63% from $142 in the same period of 2005, according to government data. The second-largest carrier on that route was Delta Air Lines Inc., which averaged $166 in the fourth quarter last year, or 28% less than Southwest.
Need to go from Boston to Los Angeles at the last minute? Southwest recently offered one-way, connecting flights for next-day travel at $523. US Airways Group Inc. offered connecting flights the same day at $320. AMR Corp.'s American, jetBlue Airways Corp. and Virgin America Inc. all had non-stops at $534.
The Middle Seat Terminal
More Seats for Flights to Europe
Southwest says prices are higher than the airline would like—a consequence of high fuel prices. The company has remained profitable, unlike so many other airlines, and passenger traffic has been growing. But the airline recognizes there will be limits to how high it can go with fares.
"We don't like the fact that we have had to increase prices, but we absolutely would continue to hold out that we are America's leading low-fare airline," said Dave Ridley, Southwest's chief marketing officer.
One major reason Southwest prices can seem higher than competitors, he noted, is because Southwest doesn't charge fees to check baggage or penalties to change tickets. Check one bag for $25 each way and a Southwest ticket that is $50 higher than another airline may, in fact, cost the same.
"We're all-in, day in and day out," Mr. Ridley said. "We continue to maintain we are the best value in the air."
There are, of course, still many markets where Southwest is indeed the lowest-priced carrier, and many where Southwest has forced rival airlines to drop their prices. Historically, there have always been instances where other airlines had cheaper prices than Southwest for particular flights. But travelers and fare analysts say that as Southwest has pushed its prices higher, that's happening more often.
"Southwest is becoming more of a hybrid, catering more to the business traveler and acting more like a 'big' airline," said Robert Harrell, a consultant who tracks airfares weekly. An upside of higher airfares: They help business travelers earn more points in Southwest's revamped frequent-flier program, which entices people to pay higher prices to get bonus points.
Craig Seidel of Palo Alto, Calif., flies Southwest frequently between San Jose and Burbank for work and has seen one-way ticket prices go from $69 Wal-Mart levels to seemingly Nordstrom levels of double or triple the price.
Has "discount" carrier Southwest become just another big airline? It is now the most expensive airline in the U.S. on a cost-per-mile basis. Scott McCartney discusses how it is bumping up fares.
"It used to be so cheap it was almost like taking the bus. But now I seem to spend $400 on a round-trip ticket," Mr. Seidel said. "I feel more of a sticker shock on airline tickets than I do at the gas pump."
Southwest's lowest unrestricted fare between San Jose and Burbank is $371; a "Business Select" upgrade adds $30.
There have been structural changes in how Southwest prices tickets. Three years ago, Southwest doubled the number of fares it offers on any flight to 16 from eight. Shoppers don't see all those fares, but they are loaded into the airline's reservation system. As seats sell, the lowest price offered bumps up to a higher fare "bucket," as the industry calls the different price levels. The move puts Southwest's structure closer to other airlines, some of which employ two dozen fare buckets.
In many cases where Southwest has a higher price than competitors, it almost always had the lower price available for a time. But after tickets sold, its best offering moved to a more expensive fare bucket, Mr. Ridley said. With Southwest pricing, it almost always pays to shop early. It's rare when Southwest cuts the prices on seats at the last minute.
For a Phoenix-Los Angeles round-trip over the July Fourth weekend, for instance, US Airways, American and Delta all offered seats at $144 but Southwest's cheapest price for the same dates was $169. Mr. Ridley said Southwest offered the $144 price, but sold all the seats it wanted to at that level and so its lowest price became $169, while competitors still had seats at the lower fare.
And Southwest prices long trips with connections differently. While many airlines offer a discount if travelers are willing to endure the inconvenience of connecting flights instead of non-stop flights, Southwest still prices connecting trips more like two non-stops. Because Southwest doesn't operate massive hubs where most traffic is funneled, it often doesn't have as many connections to offer. With fewer seats, it can price higher.
In a connecting market like Albuquerque, N.M., to Providence, R.I., Southwest's average ticket was $246 in the fourth quarter, according to Bureau of Transportation Statistics data, while Delta averaged $204.
View Full Image
Getty Images
The end of Southwest's fuel hedges made the biggest change in pricing.
Mr. Ridley said there are other reasons for Southwest's larger-than-average price surge in recent years. Southwest has been adding longer flights, pushing its average ticket price higher simply because it is flying people farther, he said. The average distance of a passenger trip on Southwest rose 14% over the past five years.
In addition, as Southwest has expanded into big-city hub airports like Philadelphia, Boston, New York and Minneapolis, it has forced competitors to reduce fares in many more markets, helping to drive the industry average lower. Moving into bigger airports has slowed Southwest's operation some and pushed operating costs higher.
The end of the fuel hedges made the biggest change in pricing, however. For many years Southwest's fuel costs were significantly lower than rival airlines because Chief Executive Gary Kelly decided when prices were low before the U.S. invasion of Iraq to prepurchase fuel and buy hedges against higher prices.
Ticket to Ride
In a spot check of 24 markets for travel over the Fourth of July weekend, Southwest had the lowest prices in only 11
From Phoenix to Los Angeles round-trip, US Airways, American and Delta all offered nonstop flights at $144; Southwest was offering its seats at the same time at $169
Between Newark Liberty International Airport and Houston round-trip, Continental had seats on nonstop flights for $412 while Southwest's cheapest price was $486
Between St. Louis and San Francisco, American's lowest price was $399 and Southwest's lowest price was $430
Mr. Ridley pointed to fares in markets Southwest doesn't serve as evidence that his airline is still the low-fare enforcer. Before Southwest began flights to Greenville-Spartanburg, S.C., in March, the one-way unrestricted coach fare to Orlando was $830. After Southwest entered, it dropped to $206. Philadelphia went from $978 one-way to $290.
Or look at a market like Atlanta-Nashville, Mr. Ridley said, which only Delta services. The average fare in the fourth quarter was $152 for that 215-mile hop, while the average price for trips of similar length in Southwest markets was significantly less, such as $110 average for Baltimore-Pittsburgh tickets in the fourth quarter, according to DOT data.
As for the "discount" airline label, Southwest has never used it or wanted it because it can conjure notions of poor service. "We see ourselves as the low-fare leader," Mr. Ridley said.
Write to Scott McCartney at [email protected]
06-02-2011, 03:48 PM
Happy to be here
Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Here's the test. Who has a Paris or Brussels overnight?
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
- Good to meet you, please leave the area, or
- HEY GUYS IT'S A DELTA PILOT, GET THIS MAN A BEER, GET THE GIRLS OVER HERE and excuse me Captain, would you like to come have a seat in our press box? Hope you don't mind the Champagne ... now her name is Sylvire' and this is Adrienne...
06-02-2011, 03:50 PM
veut gagner à la loterie
Joined APC: Apr 2008
Position: Light Chop
Posts: 23,286
Here's the test. Who has a Paris or Brussels overnight?
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
Attend the Paris Air Show. Walk to the Boeing, the Airbus, the Bombardier, and the Embraer tent. Tell them you are a Delta pilot and ask for a free beer.
Your reception will tell you all you need to know about the RFP. The response will either be:
- Good to meet you, please leave the area, or
- HEY GUYS IT'S A DELTA PILOT, GET THIS MAN A BEER, GET THE GIRLS OVER HERE and excuse me Captain, would you like to come have a seat in our press box? Hope you don't mind the Champagne ... now her name is Sylvire' and this is Adrienne...
06-02-2011, 03:52 PM
veut gagner à la loterie
Joined APC: Apr 2008
Position: Light Chop
Posts: 23,286
subtitle: "even more than his wife!"
I'll be here all night.
06-02-2011, 04:15 PM
Happy to be here
Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Can't Call Southwest a Discount Airline These Days - WSJ.com
Southwest Airlines Co., the king of low fares, is feeling its crown slip.
High fuel prices, the end of lucrative fuel hedges and a changing route network have led Southwest to push its prices up dramatically, faster than many other airlines. With last-minute fares of more than $1,000 round-trip in long-haul markets, some nonrefundable fares over $900 and average prices in some markets higher than competitors, it's hard to call Southwest a "discount" carrier anymore.
Southwest's average ticket price has jumped 39% in the past five years, while the average ticket price for domestic trips for the industry was up 10%, according to the Department of Transportation.
That's led to more markets where Southwest is sometimes higher priced than rival airlines. Between Baltimore and Oakland, Calif., a route where Southwest carries 73% of all passengers, Southwest's average ticket was $232 in the fourth-quarter last year, up a hefty 63% from $142 in the same period of 2005, according to government data. The second-largest carrier on that route was Delta Air Lines Inc., which averaged $166 in the fourth quarter last year, or 28% less than Southwest.
Need to go from Boston to Los Angeles at the last minute? Southwest recently offered one-way, connecting flights for next-day travel at $523. US Airways Group Inc. offered connecting flights the same day at $320. AMR Corp.'s American, jetBlue Airways Corp. and Virgin America Inc. all had non-stops at $534.
The Middle Seat Terminal
More Seats for Flights to Europe
Southwest says prices are higher than the airline would like—a consequence of high fuel prices. The company has remained profitable, unlike so many other airlines, and passenger traffic has been growing. But the airline recognizes there will be limits to how high it can go with fares.
"We don't like the fact that we have had to increase prices, but we absolutely would continue to hold out that we are America's leading low-fare airline," said Dave Ridley, Southwest's chief marketing officer.
One major reason Southwest prices can seem higher than competitors, he noted, is because Southwest doesn't charge fees to check baggage or penalties to change tickets. Check one bag for $25 each way and a Southwest ticket that is $50 higher than another airline may, in fact, cost the same.
"We're all-in, day in and day out," Mr. Ridley said. "We continue to maintain we are the best value in the air."
There are, of course, still many markets where Southwest is indeed the lowest-priced carrier, and many where Southwest has forced rival airlines to drop their prices. Historically, there have always been instances where other airlines had cheaper prices than Southwest for particular flights. But travelers and fare analysts say that as Southwest has pushed its prices higher, that's happening more often.
"Southwest is becoming more of a hybrid, catering more to the business traveler and acting more like a 'big' airline," said Robert Harrell, a consultant who tracks airfares weekly. An upside of higher airfares: They help business travelers earn more points in Southwest's revamped frequent-flier program, which entices people to pay higher prices to get bonus points.
Craig Seidel of Palo Alto, Calif., flies Southwest frequently between San Jose and Burbank for work and has seen one-way ticket prices go from $69 Wal-Mart levels to seemingly Nordstrom levels of double or triple the price.
Has "discount" carrier Southwest become just another big airline? It is now the most expensive airline in the U.S. on a cost-per-mile basis. Scott McCartney discusses how it is bumping up fares.
"It used to be so cheap it was almost like taking the bus. But now I seem to spend $400 on a round-trip ticket," Mr. Seidel said. "I feel more of a sticker shock on airline tickets than I do at the gas pump."
Southwest's lowest unrestricted fare between San Jose and Burbank is $371; a "Business Select" upgrade adds $30.
There have been structural changes in how Southwest prices tickets. Three years ago, Southwest doubled the number of fares it offers on any flight to 16 from eight. Shoppers don't see all those fares, but they are loaded into the airline's reservation system. As seats sell, the lowest price offered bumps up to a higher fare "bucket," as the industry calls the different price levels. The move puts Southwest's structure closer to other airlines, some of which employ two dozen fare buckets.
In many cases where Southwest has a higher price than competitors, it almost always had the lower price available for a time. But after tickets sold, its best offering moved to a more expensive fare bucket, Mr. Ridley said. With Southwest pricing, it almost always pays to shop early. It's rare when Southwest cuts the prices on seats at the last minute.
For a Phoenix-Los Angeles round-trip over the July Fourth weekend, for instance, US Airways, American and Delta all offered seats at $144 but Southwest's cheapest price for the same dates was $169. Mr. Ridley said Southwest offered the $144 price, but sold all the seats it wanted to at that level and so its lowest price became $169, while competitors still had seats at the lower fare.
And Southwest prices long trips with connections differently. While many airlines offer a discount if travelers are willing to endure the inconvenience of connecting flights instead of non-stop flights, Southwest still prices connecting trips more like two non-stops. Because Southwest doesn't operate massive hubs where most traffic is funneled, it often doesn't have as many connections to offer. With fewer seats, it can price higher.
In a connecting market like Albuquerque, N.M., to Providence, R.I., Southwest's average ticket was $246 in the fourth quarter, according to Bureau of Transportation Statistics data, while Delta averaged $204.
View Full Image
Getty Images
The end of Southwest's fuel hedges made the biggest change in pricing.
Mr. Ridley said there are other reasons for Southwest's larger-than-average price surge in recent years. Southwest has been adding longer flights, pushing its average ticket price higher simply because it is flying people farther, he said. The average distance of a passenger trip on Southwest rose 14% over the past five years.
In addition, as Southwest has expanded into big-city hub airports like Philadelphia, Boston, New York and Minneapolis, it has forced competitors to reduce fares in many more markets, helping to drive the industry average lower. Moving into bigger airports has slowed Southwest's operation some and pushed operating costs higher.
The end of the fuel hedges made the biggest change in pricing, however. For many years Southwest's fuel costs were significantly lower than rival airlines because Chief Executive Gary Kelly decided when prices were low before the U.S. invasion of Iraq to prepurchase fuel and buy hedges against higher prices.
Ticket to Ride
In a spot check of 24 markets for travel over the Fourth of July weekend, Southwest had the lowest prices in only 11
From Phoenix to Los Angeles round-trip, US Airways, American and Delta all offered nonstop flights at $144; Southwest was offering its seats at the same time at $169
Between Newark Liberty International Airport and Houston round-trip, Continental had seats on nonstop flights for $412 while Southwest's cheapest price was $486
Between St. Louis and San Francisco, American's lowest price was $399 and Southwest's lowest price was $430
Mr. Ridley pointed to fares in markets Southwest doesn't serve as evidence that his airline is still the low-fare enforcer. Before Southwest began flights to Greenville-Spartanburg, S.C., in March, the one-way unrestricted coach fare to Orlando was $830. After Southwest entered, it dropped to $206. Philadelphia went from $978 one-way to $290.
Or look at a market like Atlanta-Nashville, Mr. Ridley said, which only Delta services. The average fare in the fourth quarter was $152 for that 215-mile hop, while the average price for trips of similar length in Southwest markets was significantly less, such as $110 average for Baltimore-Pittsburgh tickets in the fourth quarter, according to DOT data.
As for the "discount" airline label, Southwest has never used it or wanted it because it can conjure notions of poor service. "We see ourselves as the low-fare leader," Mr. Ridley said.
Write to Scott McCartney at [email protected]
Southwest Airlines Co., the king of low fares, is feeling its crown slip.
High fuel prices, the end of lucrative fuel hedges and a changing route network have led Southwest to push its prices up dramatically, faster than many other airlines. With last-minute fares of more than $1,000 round-trip in long-haul markets, some nonrefundable fares over $900 and average prices in some markets higher than competitors, it's hard to call Southwest a "discount" carrier anymore.
Southwest's average ticket price has jumped 39% in the past five years, while the average ticket price for domestic trips for the industry was up 10%, according to the Department of Transportation.
That's led to more markets where Southwest is sometimes higher priced than rival airlines. Between Baltimore and Oakland, Calif., a route where Southwest carries 73% of all passengers, Southwest's average ticket was $232 in the fourth-quarter last year, up a hefty 63% from $142 in the same period of 2005, according to government data. The second-largest carrier on that route was Delta Air Lines Inc., which averaged $166 in the fourth quarter last year, or 28% less than Southwest.
Need to go from Boston to Los Angeles at the last minute? Southwest recently offered one-way, connecting flights for next-day travel at $523. US Airways Group Inc. offered connecting flights the same day at $320. AMR Corp.'s American, jetBlue Airways Corp. and Virgin America Inc. all had non-stops at $534.
The Middle Seat Terminal
More Seats for Flights to Europe
Southwest says prices are higher than the airline would like—a consequence of high fuel prices. The company has remained profitable, unlike so many other airlines, and passenger traffic has been growing. But the airline recognizes there will be limits to how high it can go with fares.
"We don't like the fact that we have had to increase prices, but we absolutely would continue to hold out that we are America's leading low-fare airline," said Dave Ridley, Southwest's chief marketing officer.
One major reason Southwest prices can seem higher than competitors, he noted, is because Southwest doesn't charge fees to check baggage or penalties to change tickets. Check one bag for $25 each way and a Southwest ticket that is $50 higher than another airline may, in fact, cost the same.
"We're all-in, day in and day out," Mr. Ridley said. "We continue to maintain we are the best value in the air."
There are, of course, still many markets where Southwest is indeed the lowest-priced carrier, and many where Southwest has forced rival airlines to drop their prices. Historically, there have always been instances where other airlines had cheaper prices than Southwest for particular flights. But travelers and fare analysts say that as Southwest has pushed its prices higher, that's happening more often.
"Southwest is becoming more of a hybrid, catering more to the business traveler and acting more like a 'big' airline," said Robert Harrell, a consultant who tracks airfares weekly. An upside of higher airfares: They help business travelers earn more points in Southwest's revamped frequent-flier program, which entices people to pay higher prices to get bonus points.
Craig Seidel of Palo Alto, Calif., flies Southwest frequently between San Jose and Burbank for work and has seen one-way ticket prices go from $69 Wal-Mart levels to seemingly Nordstrom levels of double or triple the price.
Has "discount" carrier Southwest become just another big airline? It is now the most expensive airline in the U.S. on a cost-per-mile basis. Scott McCartney discusses how it is bumping up fares.
"It used to be so cheap it was almost like taking the bus. But now I seem to spend $400 on a round-trip ticket," Mr. Seidel said. "I feel more of a sticker shock on airline tickets than I do at the gas pump."
Southwest's lowest unrestricted fare between San Jose and Burbank is $371; a "Business Select" upgrade adds $30.
There have been structural changes in how Southwest prices tickets. Three years ago, Southwest doubled the number of fares it offers on any flight to 16 from eight. Shoppers don't see all those fares, but they are loaded into the airline's reservation system. As seats sell, the lowest price offered bumps up to a higher fare "bucket," as the industry calls the different price levels. The move puts Southwest's structure closer to other airlines, some of which employ two dozen fare buckets.
In many cases where Southwest has a higher price than competitors, it almost always had the lower price available for a time. But after tickets sold, its best offering moved to a more expensive fare bucket, Mr. Ridley said. With Southwest pricing, it almost always pays to shop early. It's rare when Southwest cuts the prices on seats at the last minute.
For a Phoenix-Los Angeles round-trip over the July Fourth weekend, for instance, US Airways, American and Delta all offered seats at $144 but Southwest's cheapest price for the same dates was $169. Mr. Ridley said Southwest offered the $144 price, but sold all the seats it wanted to at that level and so its lowest price became $169, while competitors still had seats at the lower fare.
And Southwest prices long trips with connections differently. While many airlines offer a discount if travelers are willing to endure the inconvenience of connecting flights instead of non-stop flights, Southwest still prices connecting trips more like two non-stops. Because Southwest doesn't operate massive hubs where most traffic is funneled, it often doesn't have as many connections to offer. With fewer seats, it can price higher.
In a connecting market like Albuquerque, N.M., to Providence, R.I., Southwest's average ticket was $246 in the fourth quarter, according to Bureau of Transportation Statistics data, while Delta averaged $204.
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The end of Southwest's fuel hedges made the biggest change in pricing.
Mr. Ridley said there are other reasons for Southwest's larger-than-average price surge in recent years. Southwest has been adding longer flights, pushing its average ticket price higher simply because it is flying people farther, he said. The average distance of a passenger trip on Southwest rose 14% over the past five years.
In addition, as Southwest has expanded into big-city hub airports like Philadelphia, Boston, New York and Minneapolis, it has forced competitors to reduce fares in many more markets, helping to drive the industry average lower. Moving into bigger airports has slowed Southwest's operation some and pushed operating costs higher.
The end of the fuel hedges made the biggest change in pricing, however. For many years Southwest's fuel costs were significantly lower than rival airlines because Chief Executive Gary Kelly decided when prices were low before the U.S. invasion of Iraq to prepurchase fuel and buy hedges against higher prices.
Ticket to Ride
In a spot check of 24 markets for travel over the Fourth of July weekend, Southwest had the lowest prices in only 11
From Phoenix to Los Angeles round-trip, US Airways, American and Delta all offered nonstop flights at $144; Southwest was offering its seats at the same time at $169
Between Newark Liberty International Airport and Houston round-trip, Continental had seats on nonstop flights for $412 while Southwest's cheapest price was $486
Between St. Louis and San Francisco, American's lowest price was $399 and Southwest's lowest price was $430
Mr. Ridley pointed to fares in markets Southwest doesn't serve as evidence that his airline is still the low-fare enforcer. Before Southwest began flights to Greenville-Spartanburg, S.C., in March, the one-way unrestricted coach fare to Orlando was $830. After Southwest entered, it dropped to $206. Philadelphia went from $978 one-way to $290.
Or look at a market like Atlanta-Nashville, Mr. Ridley said, which only Delta services. The average fare in the fourth quarter was $152 for that 215-mile hop, while the average price for trips of similar length in Southwest markets was significantly less, such as $110 average for Baltimore-Pittsburgh tickets in the fourth quarter, according to DOT data.
As for the "discount" airline label, Southwest has never used it or wanted it because it can conjure notions of poor service. "We see ourselves as the low-fare leader," Mr. Ridley said.
Write to Scott McCartney at [email protected]
06-02-2011, 04:26 PM
veut gagner à la loterie
Joined APC: Apr 2008
Position: Light Chop
Posts: 23,286
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SHOCK:
Feds to probe union charges of Delta election interference | ajc.comthe FA's will have to vote until they vote the AFA in.
And don't get me wrong, if the FA's want the AFA to represent them, that's their business. If, to me a separate topic, they want to decide on having a union or not it's still their call, 100%.
But Linda Puchala on the NMB is b.s. That irritates me.
Last edited by forgot to bid; 06-02-2011 at 04:37 PM.
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