Aloha Files for Chapter 11
03-21-2008, 06:19 PM
#13
Gets Weekends Off
Joined APC: Dec 2006
Position: I was acquired, Not Hired
Posts: 1,784
Go is not the only airline coming into a market, charging $39 one way then driving the incumbent airline out.
$39 one way Los Angeles to any Bay Area Airport.
FF
$39 one way Los Angeles to any Bay Area Airport.
FF
Last edited by FliFast; 03-22-2008 at 01:40 PM.
03-22-2008, 05:07 AM
#14
Retired
Joined APC: Feb 2008
Position: whale wrangler
Posts: 3,527
Flying its not just a job Its an adventure
03-22-2008, 07:44 AM
#15
AAmerican Way for AA Pay
Joined APC: Oct 2005
Position: B-737 Pilot
Posts: 1,617
03-22-2008, 02:05 PM
#17
Gets Weekends Off
Joined APC: Dec 2006
Position: I was acquired, Not Hired
Posts: 1,784
Go's plan was to come into a market with disgustingly low prices and drive out incumbent's Aloha and Hawaiian.
When Southwest came into California, they came in and still offer fares well below then USAir (formerly PSA), United, and American/American Eagle. United countered with the United Shuttle, but depending on who you talk to it was not effective enough to turn Southwest away.
Fast forward to today, USAir (pre-America West) abandoned their North-South California routes. The United Shuttle was discontinued and although United still has North-South flying in Calif., it is a scaled down version of the Shuttle. American has farmed out most of their intra-Calif. flyng to Eagle. This example is almost a carbon copy of what transpired with USAir and Southwest in Baltimore back in the mid-90s.
Do I think Southwest and Mesa should be used in the same sentence...NO. However, their strategies have some similarities and that is, lower the fares in the market, erode the revenue per avail. seat mile(RASM), and then fight a war of attrition against the incumbent until they capitualte. Once they do, increase market share and fares but still keep fares low enough that other don't poach your rewards. For the record, I don't have a bone against SW. It's just that their strategy has re-defined the post-deregulated industry and has been extensively studied and often tried to duplicate (mostly unsuccessfully) by other airlines.
I'm really not sure how markets of different sizes reveal different strategies which have the same goal: market share.
My point, low cost carriers are here to stay. Their goal is to lower fares in a market, reduce the revenue in the market, and then fight a war of attrition with the home team. Taken straight from Alfred Kahn's vision of Airline Deregulation.
FF
03-22-2008, 02:26 PM
#18
*********
Joined APC: Dec 2007
Posts: 1,068
Mesa Go! was advertising in HNL papers for $19 fares, to and from out islands where Hawaiian/Aloha charge $90-$100 a seat. Undercutting isn't the word, nor is predatory. It is totally insane and obvious what go! is doing.
A 737/717 is much more efficient to operate on inter-island than a 50-seat RJ.
A 737/717 is much more efficient to operate on inter-island than a 50-seat RJ.
03-22-2008, 03:34 PM
#19
Retired
Joined APC: Feb 2008
Position: whale wrangler
Posts: 3,527
Respectfully, I'm not sure what the size of the market has to do with Go's strategy or any other low-cost carrier's plan.
Go's plan was to come into a market with disgustingly low prices and drive out incumbent's Aloha and Hawaiian.
When Southwest came into California, they came in and still offer fares well below then USAir (formerly PSA), United, and American/American Eagle. United countered with the United Shuttle, but depending on who you talk to it was not effective enough to turn Southwest away.
Fast forward to today, USAir (pre-America West) abandoned their North-South California routes. The United Shuttle was discontinued and although United still has North-South flying in Calif., it is a scaled down version of the Shuttle. American has farmed out most of their intra-Calif. flyng to Eagle. This example is almost a carbon copy of what transpired with USAir and Southwest in Baltimore back in the mid-90s.
Do I think Southwest and Mesa should be used in the same sentence...NO. However, their strategies have some similarities and that is, lower the fares in the market, erode the revenue per avail. seat mile(RASM), and then fight a war of attrition against the incumbent until they capitualte. Once they do, increase market share and fares but still keep fares low enough that other don't poach your rewards. For the record, I don't have a bone against SW. It's just that their strategy has re-defined the post-deregulated industry and has been extensively studied and often tried to duplicate (mostly unsuccessfully) by other airlines.
I'm really not sure how markets of different sizes reveal different strategies which have the same goal: market share.
My point, low cost carriers are here to stay. Their goal is to lower fares in a market, reduce the revenue in the market, and then fight a war of attrition with the home team. Taken straight from Alfred Kahn's vision of Airline Deregulation.
FF
Go's plan was to come into a market with disgustingly low prices and drive out incumbent's Aloha and Hawaiian.
When Southwest came into California, they came in and still offer fares well below then USAir (formerly PSA), United, and American/American Eagle. United countered with the United Shuttle, but depending on who you talk to it was not effective enough to turn Southwest away.
Fast forward to today, USAir (pre-America West) abandoned their North-South California routes. The United Shuttle was discontinued and although United still has North-South flying in Calif., it is a scaled down version of the Shuttle. American has farmed out most of their intra-Calif. flyng to Eagle. This example is almost a carbon copy of what transpired with USAir and Southwest in Baltimore back in the mid-90s.
Do I think Southwest and Mesa should be used in the same sentence...NO. However, their strategies have some similarities and that is, lower the fares in the market, erode the revenue per avail. seat mile(RASM), and then fight a war of attrition against the incumbent until they capitualte. Once they do, increase market share and fares but still keep fares low enough that other don't poach your rewards. For the record, I don't have a bone against SW. It's just that their strategy has re-defined the post-deregulated industry and has been extensively studied and often tried to duplicate (mostly unsuccessfully) by other airlines.
I'm really not sure how markets of different sizes reveal different strategies which have the same goal: market share.
My point, low cost carriers are here to stay. Their goal is to lower fares in a market, reduce the revenue in the market, and then fight a war of attrition with the home team. Taken straight from Alfred Kahn's vision of Airline Deregulation.
FF
there are old pilots and bold pilots but there are no old bold pilots
03-23-2008, 06:51 PM
#20
Gets Weekends Off
Joined APC: Apr 2007
Posts: 211
Just seeing one of your company's airplanes made me furious. A travel agent had booked some family member's on go! during our visit, and when I saw that, I explained to them what go! actually was and they then got their flights changed to Aloha.
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