The Future of United Airlines ???
#31
Just an outside observer, but I find it very coincidental that SWA decided to re-start service @ SFO shortly after Virgin America got it's OK from the US Government to start service. SFO is VA's 1 and only Base (for now)
SWA isn't going after UAL they are going after VA........
#32
UAL has had inferior management for quite some time. Long before Tilton who might be a good "money man", but NOT a leader. A numbers cruncher.
One of the biggest potential assets that UAL has always had is their work force, but management pays lip service to its employees.
The opposite is SWA, with their management that stays focused and recognizes the value of their work force, is the reason for their unparalleled success in the airliner industry.
One of the biggest potential assets that UAL has always had is their work force, but management pays lip service to its employees.
The opposite is SWA, with their management that stays focused and recognizes the value of their work force, is the reason for their unparalleled success in the airliner industry.
Here is a simple metaphor to explain what I mean.
Executive Management determines that their NEW business model is to “Pound Nails into Walls.” Let’s all get behind this Mission and make it work, but let’s keep costs in line. Go Get ‘em Team.
Operations (day to day business) needs to pound nails into a wall. They do not have a hammer. Operations asks Finance to buy them a tool, called a hammer so they can do their job. Finance (sitting behind a desk looking at the black and white numbers) looks into it and determines that a hammer will cost $5.00 while a screwdriver (a TOOL in the eyes of finance) will cost only a $1.00. Finance, determines that buying the tool called a screwdriver will reduce expenditure by 80% over buying the tool called the hammer. Finance buys the screwdriver, sends it to Operations and says this is what we can afford, so you have to use this.
Operations tries to pound in nails with a screwdriver, the wrong tool for the job. It doesn’t work. Operations becomes frustrated because they cannot do their job without the proper tools. Executive management sees that nails are not being pounded in the walls, they come down hard on operations for not doing their job, now more expenses are being cut because the actual number of nails pounded in the walls FELL way short of what is actually pounded into the walls. Management determines that even more expenses need to be cut because of the lack of nails pounded into the walls. Less and less nails are being pounded into walls, even more expenses are being cut. Finally management abandons the idea of pounding nails into the walls and decides to use Duct Tape on the walls instead . . . . . . .etc, etc . . . . You can all see where this is going.
Until United is able to determine what their business is, what it should do, where it should go, and what tools and investment it needs to get there, they will continue to run into problems, with profitability, morale and business success.
This is an extremely simple version at what is happening at United.
#33
Banned
Joined APC: Oct 2006
Position: DHC-8 F/O
Posts: 142
I choose to take my industry advice and stock pointers from someone other than a retired basketball player, and current NBA coach.
#34
Gets Weekends Off
Joined APC: Feb 2007
Position: Just happy to be here Boss!
Posts: 200
Just to play Devil's Advocate...
Jsled, Maybe SWA pulled out of DEN pre-911 because UAL was simply too strong at the time...not anymore. SWA's publicly stated goal is 150 departures a day. They are a third of the way there already.
Farnuts, They left SFO for the reasons you stated, but more important was SFO would not give them anymore gates or departure slots for expansion (SFO was a dead end at the time). King UAL put a lot of pressure on the airport authority and the local politicians to keep SWA out. That changed when BK hit and UAL lost a boat load of influence. And granted, the whole off-set approach thing helped.
As for the idea that SWA is putting airplanes anywhere they can because they ordered too many is just, for lack of a better term, ridiculous. SWA has proven over and over again every thing they do is part of a well thought out, long term strategy. They still have roughly 100 jets on firm order and are actively looking for used jets, because they can not get new ones fast enough. That is not what a company does when it has "run out of places to put them".
Redeye, No doubt VA was part of a decision matrix to go to SFO, and I do not believe SWA is going after UAL in the sense that they want to put them out of business. But, SFO, DEN, and DCA are lucrative markets SWA was not in. I think it would have to be a far bigger coincidence that SWA has gone outside of its normal model into three of UAL's Five biggest airports for any reason other than they see a vulnerable United.
My hypothesis is this: SWA's big push is to get itself firmly established in these markets while UAL is too weak to defend it. If UAL goes down, SWA is in great position to make big money. If UAL comes back (even comes back strong) SWA hopes to have enough of a foothold that UAL can not afford to undercut all their routes and drive them out...then SWA can just slowly build their market share like they have always done.
But then again, I'm am probably way off!!!
Jsled, Maybe SWA pulled out of DEN pre-911 because UAL was simply too strong at the time...not anymore. SWA's publicly stated goal is 150 departures a day. They are a third of the way there already.
Farnuts, They left SFO for the reasons you stated, but more important was SFO would not give them anymore gates or departure slots for expansion (SFO was a dead end at the time). King UAL put a lot of pressure on the airport authority and the local politicians to keep SWA out. That changed when BK hit and UAL lost a boat load of influence. And granted, the whole off-set approach thing helped.
As for the idea that SWA is putting airplanes anywhere they can because they ordered too many is just, for lack of a better term, ridiculous. SWA has proven over and over again every thing they do is part of a well thought out, long term strategy. They still have roughly 100 jets on firm order and are actively looking for used jets, because they can not get new ones fast enough. That is not what a company does when it has "run out of places to put them".
Redeye, No doubt VA was part of a decision matrix to go to SFO, and I do not believe SWA is going after UAL in the sense that they want to put them out of business. But, SFO, DEN, and DCA are lucrative markets SWA was not in. I think it would have to be a far bigger coincidence that SWA has gone outside of its normal model into three of UAL's Five biggest airports for any reason other than they see a vulnerable United.
My hypothesis is this: SWA's big push is to get itself firmly established in these markets while UAL is too weak to defend it. If UAL goes down, SWA is in great position to make big money. If UAL comes back (even comes back strong) SWA hopes to have enough of a foothold that UAL can not afford to undercut all their routes and drive them out...then SWA can just slowly build their market share like they have always done.
But then again, I'm am probably way off!!!
#35
Just to play Devil's Advocate...
Jsled, Maybe SWA pulled out of DEN pre-911 because UAL was simply too strong at the time...not anymore. SWA's publicly stated goal is 150 departures a day. They are a third of the way there already.
Farnuts, They left SFO for the reasons you stated, but more important was SFO would not give them anymore gates or departure slots for expansion (SFO was a dead end at the time). King UAL put a lot of pressure on the airport authority and the local politicians to keep SWA out. That changed when BK hit and UAL lost a boat load of influence. And granted, the whole off-set approach thing helped.
As for the idea that SWA is putting airplanes anywhere they can because they ordered too many is just, for lack of a better term, ridiculous. SWA has proven over and over again every thing they do is part of a well thought out, long term strategy. They still have roughly 100 jets on firm order and are actively looking for used jets, because they can not get new ones fast enough. That is not what a company does when it has "run out of places to put them".
Redeye, No doubt VA was part of a decision matrix to go to SFO, and I do not believe SWA is going after UAL in the sense that they want to put them out of business. But, SFO, DEN, and DCA are lucrative markets SWA was not in. I think it would have to be a far bigger coincidence that SWA has gone outside of its normal model into three of UAL's Five biggest airports for any reason other than they see a vulnerable United.
My hypothesis is this: SWA's big push is to get itself firmly established in these markets while UAL is too weak to defend it. If UAL goes down, SWA is in great position to make big money. If UAL comes back (even comes back strong) SWA hopes to have enough of a foothold that UAL can not afford to undercut all their routes and drive them out...then SWA can just slowly build their market share like they have always done.
But then again, I'm am probably way off!!!
Jsled, Maybe SWA pulled out of DEN pre-911 because UAL was simply too strong at the time...not anymore. SWA's publicly stated goal is 150 departures a day. They are a third of the way there already.
Farnuts, They left SFO for the reasons you stated, but more important was SFO would not give them anymore gates or departure slots for expansion (SFO was a dead end at the time). King UAL put a lot of pressure on the airport authority and the local politicians to keep SWA out. That changed when BK hit and UAL lost a boat load of influence. And granted, the whole off-set approach thing helped.
As for the idea that SWA is putting airplanes anywhere they can because they ordered too many is just, for lack of a better term, ridiculous. SWA has proven over and over again every thing they do is part of a well thought out, long term strategy. They still have roughly 100 jets on firm order and are actively looking for used jets, because they can not get new ones fast enough. That is not what a company does when it has "run out of places to put them".
Redeye, No doubt VA was part of a decision matrix to go to SFO, and I do not believe SWA is going after UAL in the sense that they want to put them out of business. But, SFO, DEN, and DCA are lucrative markets SWA was not in. I think it would have to be a far bigger coincidence that SWA has gone outside of its normal model into three of UAL's Five biggest airports for any reason other than they see a vulnerable United.
My hypothesis is this: SWA's big push is to get itself firmly established in these markets while UAL is too weak to defend it. If UAL goes down, SWA is in great position to make big money. If UAL comes back (even comes back strong) SWA hopes to have enough of a foothold that UAL can not afford to undercut all their routes and drive them out...then SWA can just slowly build their market share like they have always done.
But then again, I'm am probably way off!!!
Thanks for your "take" on this thread. I believe you have a good understanding of these events/issues and appreciate your perspective!
#36
Itsallgood: I think you're spot-on.
Why would SWA be buying 737's from the used market that they have no obligation to take unless they thought they needed them. Why did they buy two from Ford 9 months ago? Those airplanes were flying the line before they were even painted properly.
My rumor mill tells me that SWA management thinks they currently can't get enough airplanes. Gary Kelley recently told a new class that the demand in Denver alone could fill up all the airplanes they're buying this year.
Why would SWA be buying 737's from the used market that they have no obligation to take unless they thought they needed them. Why did they buy two from Ford 9 months ago? Those airplanes were flying the line before they were even painted properly.
My rumor mill tells me that SWA management thinks they currently can't get enough airplanes. Gary Kelley recently told a new class that the demand in Denver alone could fill up all the airplanes they're buying this year.
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