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Topic: What Is The Secret Of LCC's?
Username: Captaink
Posted 2003-12-20 03:05:02 and read 2882 times.

"The only way to stop the LCC's is to do what the LCC's do, but do it better."

The above statement is something that many people say, especially when commenting on the survival of US Airways and other dying airlines. But can someone, itemize what is it that LCC does, that keeps them so high above the crowd?

What is it that full service airlines can copy, to ensure their survival and not loose the the perks of full service carriers that many people still appreciate?

Topic: RE: What Is The Secret Of LCC's?
Username: Luv2fly
Posted 2003-12-20 03:11:26 and read 2869 times.

The sad thing is that there is NO secret. Good service, pay for what you get, be treated like you business matters, and if you work for the LCC's be appreciated and made to feel that you working for them also matters. Open communication between labor and management. Simple tho not that many get it..... Importantly have a well defined business plan and above all in good times and trying times stick to it, do not try to be all things to all people.

Topic: EK 345
Username: Rjpieces
Posted 2003-12-20 03:32:58 and read 2850 times.

LCCs and Majors perform the same functions these days except it costs the majors a lot more to do it.

Topic: RE: What Is The Secret Of LCC's?
Username: M404
Posted 2003-12-20 04:46:17 and read 2813 times.

1. Southwest showed it could be done
2. JetBlue proved they were right
3. Enthusiastic unjaded workers who have been as yet unexposed to a different system.
4. Largely non-union
5. With the above in play Wall Street likes backing the new guy on the block.
6. Established carriers have a debt load that is INCREDABLE, much at older and higher interest rates.
7. Legacy carriers have depended far too long on the First class passenger to carry the load.
8. Legacy carriers needlessly stick it to their customers with a Saturday layover rule.
9. Very few employees of the new carriers are being supported on retirement yet.
10. The new guys have not had to do a complete about face in the business model as when deregulation came in.
11. Legacy carriers have an employee base who for the large part have seen much better days and are sick and tired of being told it's all their fault. They have been through the Mutual Aid Pact, Deregulation and the opening of the cabin to the new kind of traffic generated by lower fares and the higher expectations they demand from an industry going the opposite direction. They see machines taking over the jobs they've worked 20-30 years to get even though many understand the economics involved. Many new hires seem, to say the least, not acclimated to a competitive passenger service but are not weeded out fast enough by management and union rules can keep older bad apples in the basket.


The list can go on much longer than this but you have posed an excellent and very important question. One I hope union and management reads and the passenger understands. I would like nothing better than to have the older carriers learn from all this and be able to rise to the demand and show Richard Branson that they all do not need to go off and die...And their employees will NOT have to live on the government dole until new lower paying jobs are found and that their retirements are kept solvent. Unions do have their place to insure against abuses by all parties and that discipline is handed out equally and not just politically correct. Both need to work together and must put aside 40 years of mistrust to survive. This is one more thing the new carriers as yet do not, for the large part, need to worry about.

Topic: RE: What Is The Secret Of LCC's?
Username: Elwood64151
Posted 2003-12-20 05:32:41 and read 2780 times.

Not yet mentioned:

Required service at unprofitable airports due to the deregulation act.

Lower, more customer-friendly walk-up fares.

Simpler fare structures that make it easy to find low-cost flights.

Treating employees like assets, not adversaries.



Of course, none of this is a "secret" (as mentioned above). It's common knowledge to sophomore- and junior-year business students. Sometime during or after grad school the future CEOs, COOs, CFOs, etc, just plain forget it.

Topic: RE: What Is The Secret Of LCC's?
Username: Midway2airtran
Posted 2003-12-20 05:50:03 and read 2768 times.

Same airline product, maybe better in some cases, and the rest is in the name.

Topic: RE: What Is The Secret Of LCC's?
Username: SOUTHAMERICA
Posted 2003-12-20 06:02:58 and read 2765 times.


Apart from the above mentioned, there are certain other "rules" or tips that LCC follow to be able to provide the level service they offer at such prices:

1. They serve airports with the lowest operation fees posibles. Generally, this points out secondary airports where less airlines operate to/from. For example, Ryanair flies to Barcelona/Girona, one hour north of Barcelona, instead of BCN. Same goes for Frankfurt - Hahn.

2. They also base operations on airport with low delay possibilities. This way, the can assure maximum aircraft utilization. For example, ISP over JFK; MDW over ORD; LGB, BUR or ONT over LAX; OAK over SFO, etc.

3. They go through ground operations even faster. Try to spend the less time possible at the gate from arrival to departure.

4. They operate a standarized fleet in order to reduce costs to the lowest levels. Example, Southwest, JetBlue, etc.


Regards,


SOUTHAMERICA

Topic: RE: What Is The Secret Of LCC's?
Username: Elwood64151
Posted 2003-12-20 06:23:10 and read 2752 times.

2. They also base operations on airport with low delay possibilities. This way, the can assure maximum aircraft utilization. For example, ISP over JFK; MDW over ORD; LGB, BUR or ONT over LAX; OAK over SFO, etc.

I have to disagree with you there. WN operates out of secondary airports quite a lot, but JetBlue is based at JFK. AirTran flies into LAX and SFO, as well as IAD, DCA, MCO, MIA, EWR, LGA, BOS, PHL, TPA, and more. Frontier flies to several secondary airports, but also flies right into some of the primary airports next-door (ONT and LAX, for example).

3. They go through ground operations even faster. Try to spend the less time possible at the gate from arrival to departure.

This didn't help Eastern make money.

"A plane sitting on the ground is a plane not making money." - Eddie Rickenbacker, CEO Eastern Airlines

(or something to that effect)

4. They operate a standarized fleet in order to reduce costs to the lowest levels. Example, Southwest, JetBlue, etc.

WN's fleet is hardly standard, with a mix of 732s, 733s, 735s, and 73Gs. They are also talking about an RJ model. FL has had 717s operating along side DC-9s for awhile, once operated both MD-80s and 732s, and will soon be adding 73Gs and 738s. JetBlue has placed its bets on Embaerer aircraft.

Sorry to pick your post apart, but I have to disagree with your points.

Topic: RE: What Is The Secret Of LCC's?
Username: SOUTHAMERICA
Posted 2003-12-20 07:23:28 and read 2729 times.

Elwood64151,

No problem with me. We are here to learn anyways...  Smile

In the second point I should've added the word generally, as in some cases they follow this "rule" and in some cases they don't. But it does happen and it's even been stated several times here in A.net too.

About the third point. They actually do try to make this happen. Eastern obviously had more mistakes in their management that were a lot deeper. But WN is an example, and they try to design routes with one or two stops too.

About the fourth point. WN does have 737s from all generations, but they still belong to the same family line, hence, the same crue for all aircraft, ground handling is a lot easier, maintenance is very alike too. Aren't these the targets of a standarized fleet??

I think you're being quite intolerant here Fred. You argued very little details about each point, instead of correcting a general mistake...

Regards,


SOUTHA.

Topic: RE: What Is The Secret Of LCC's?
Username: Capt078
Posted 2003-12-20 15:48:24 and read 2690 times.

Elmwood64151:

i agree with many of your points, but i too feel the need to pick. first of all, with the exception of a brief lease of three 727s, southwest has maintained a common fleet. while there are difference between the 737-200 and 737-700, the differences are relatively small compared to say the differences between a fokker f-100 and a 777-200. because all of southwest's planes are 737s, they have many common parts, and more importantly, require much less training for pilot and crew advancement than that required by an airline with a diverse fleet.

airtran never operated the md-80, and their current order for 737s is for both the 737-700 and 737-800; both are considered -ng.

i want to applaud you for mentioning how majors fly into unprofitable airports, that is something people often fail to realize is a critical difference between "traditional" network carriers, and low-cost carriers. every time someone mentions that american or delta should become a low-cost carrier, i want to retort that doing so would prohibit service to low-demand markets. there are hundreds of smaller cities and towns, enjoying daily regional jet and turboprop flights, that get this service because the major network carriers are able to subsidize these flights by the high fares on high-demand routes. with the increased prevalence of low-cost carriers, the profits of the "bread" routes are weakened, and thus many low-demand markets are seeing their service jeopardized, or their fares raised to the point of forcing travelers to either not travel or drive to a larger-demand airport. furthermore, people also fail to remember that none of the low-cost carriers fly internationally (except to the bahamas or mexico), and thus are shielded from the costs associated from that type of service.

now, we are starting to see a trend, whereby the traditional carriers are adopting low-cost strategies on high-demand routes. one look at SONG, TED, and the increased capacities on 757s for both american and us airways are all evidence of this. by doing this, the traditional carriers will hopefully be able to compete against the low-cost carriers, but consequently, will be cutting their abilities to subsidize routes into small cities. i think in the future, we will see many more airlines adopt the airtran strategy of securing promises of demand from future destinations. the airline essentially gets the city to create an escrow account, whereby if not enough revenue is generated by the new destination, the city will subsidize airtran's costs. this is similar to federal subsidies of service to small cities, but instead the funding comes from local tax dollars, something that should better determine demand and level of service.


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