STT757 From United States, joined Mar 2000, 12210 posts, RR: 55 Posted (5 years 8 months 3 days 17 hours ago) and read 2273 times:
Southwest Airlines Pondering a Bigger Start in Philadelphia
By MICHELINE MAYNARD
Published: April 16, 2004
"Southwest Airlines said yesterday that it was considering adding more flights from Philadelphia International Airport, where it plans to begin service next month, and said that it believed the city could become one of its major destinations.
The announcement highlights the continued heated competition between major airlines and low-fare carriers.
Southwest's chief financial officer, Gary C. Kelly, said Philadelphia had the potential to rank with Baltimore-Washington International Airport as one of his airline's biggest destinations. In the 1990's, Southwest edged out US Airways to become the biggest carrier serving Baltimore.
Southwest, the nation's largest low-fare carrier and the sixth-largest domestic airline, will start Philadelphia service on May 9, reaching 28 departures a day to 14 cities by July. Its original plan, announced last October, was to serve six cities with 14 departures a day.
Its moves have set off a flurry of activity at an airport long dominated by US Airways, the seventh-largest airline, which uses Philadelphia as one of its three hubs.
US Airways, which has 375 daily departures from Philadelphia, has responded by increasing flights to the destinations served by Southwest, and dropping fares on those routes. Frontier Airlines, meanwhile, announced that it would begin service to Philadelphia from Denver and Los Angeles on May 23.
Also yesterday, Delta Air Lines said it would offer 15 flights a day from Atlanta to Philadelphia beginning June 1, up from 11 now. That effort is aimed more at competing with AirTran, which serves the same route, than Southwest, which does not fly to Atlanta.
But Delta's action illustrates the newfound seriousness with which the industry is viewing Philadelphia. US Airways chief executive, David N. Siegel, has used Southwest's imminent arrival as a rallying cry in his bid to wrest a third round of contract concessions from his airline's unions. Last month, Mr. Siegel declared on an employee telecast that Southwest was "coming to kill us."
In a conference call yesterday, Mr. Kelly said the expansion in Philadelphia was the first time in Southwest's history that it had added flights from a new market before it had begun service there. He said advance reservations were the strongest ever for the airline at a new city.
"Are we thinking about more flights? Well, yeah, based on the way things seem to be," Mr. Kelly said.
The increase could be sharp. Mr. Kelly noted that Southwest began service in Baltimore in 1993 with eight departing flights a day. It now offers 162, making Baltimore the airline's third-biggest destination, behind Las Vegas and Phoenix.
"Can we do that with Philadelphia in theory? We don't have a plan that says 162, but it is that kind of potential, and we'll see where things play out," Mr. Kelly said.
Mr. Kelly's comments came as Southwest said it earned $26 million during the first quarter, slightly better than the $24 million it earned a year ago. It was the airline's 52nd consecutive quarterly profit.
But while Southwest was more than 80 percent hedged against jet fuel prices, which have climbed more than 41 percent in the last year, Mr. Kelly said the issue was still affecting the airline's results. "Our costs are up; we're not happy about that," Mr. Kelly said.
He acknowledged that the airline would spend more on advertising in the second quarter, as it begins service from Philadelphia. But he said he hoped stronger business during the summer would offset the expense.
Continental Airlines, meanwhile, said higher jet fuel costs were the major factor in its $124 million loss. That was about half the airline's $221 million loss in the first quarter last year. Continental had hoped to break even for 2004, a prospect executives say is vanishing as fuel prices rise.
In addition, United Airlines, which is under bankruptcy protection, forecast yesterday that its jet fuel costs in 2004 would be $450 million more than expected when it drafted a business plan in mid-December. The plan formed the basis of United's application for $1.6 billion in federally backed loans. United made the disclosure in documents filed with the United States Bankruptcy Court in Chicago."
"'Brown Sugar' could save the world..." Eddie Vedder 10/14/97 Oakland, California
PHLBOS From United States, joined Mar 2004, 5570 posts, RR: 28 Reply 1, posted (5 years 8 months 3 days 17 hours ago) and read 2215 times:
With WN and DL adding flights, I hope DOA has an interim plan to expand the security checkpoint at Terminal E (where WNs and DLs gates are located) otherwise, we'll be seeing lines that could stretch as far back as the Parking Garage on the Terminal E Pedestrian Bridge or into Terminal F should it be decided to have the security line stretch into the E-F connector.
The planned Terminal D-E consolidation is still about a couple years away from becoming reality.
"TransEastern! You'll feel like you've never left the ground because we treat you like dirt!" SNL Parady ad circa 1981
Deltaffindfw From United States, joined Sep 2003, 1249 posts, RR: 1 Reply 5, posted (5 years 8 months 3 days 15 hours ago) and read 2026 times:
I agree with Flairport. DL is not attacking FL as much as US with their ATL service! Might as well get in a punch or two before US is knocked out for good...
Transtar01 From United States, joined Mar 2004, 43 posts, RR: 0 Reply 6, posted (5 years 8 months 3 days 15 hours ago) and read 1983 times:
Why doesn't US Airways just change their name to Allegheny Airlines and have a few flights out of Pittsburgh? Maybe pick up a few Convair 580s and F27s to serve their needs. And a couple of BAC 111s for their long hauls to Chicago!
PVD757 From United States, joined Aug 2003, 3230 posts, RR: 22 Reply 7, posted (5 years 8 months 3 days 14 hours ago) and read 1912 times:
Here's some data for you to ponder. The PVD-PHL market averaged anywhere from 116 to 170 O&D passengers per day from 1Q02 to 2Q03 despite having an average one way fare anywhere from $298.00 to $325.00. Those average one way fares were in the top 3 highest (some quarters it was THE highest)fares from PVD to any domestic market that averaged 10 daily O&D passengers or more. US controlled almost all the traffic in that market. WN offers advanced fares as low as $29.00 and walk-up fares of $49.00. These fares are over half as cheap as the train and boast an hour flight time versus a 6 to 7 hour drive/ride via surface transportation though NYC. I've been told that similar scenarios are true in many other PHL markets, so I think it's safe to say that WN has more than ample opportunity to do thier thing in PHL at whatever scale they see fit!
Scottb From United States, joined Jul 2000, 4285 posts, RR: 34 Reply 8, posted (5 years 8 months 3 days 13 hours ago) and read 1848 times:
It's entirely unsurprising that Southwest expects PHL to become a major station for them, even with BWI less than 100 miles away. Look at it this way: The Washington-Baltimore region supports three major airports (DCA/IAD/BWI) as compared to a single major airport (PHL) and two minor relievers (ACY/ABE) in the Philadelphia region, and yet the population of the Philadelphia area is only about 25% smaller than that of the Washington-Baltimore area. To look at it another way, the domestic O&D traffic at Washington/Baltimore's three airports, excluding flights to the NYC metro area, runs a bit under 30 million passengers per year. The domestic O&D traffic from PHL runs at about 12 million passengers per year. I excluded traffic from IAD/DCA/BWI to NYC/ISP/HPN to help make the comparison more valid; few people fly from Philadelphia to the NYC metro area. With comparable stimulation from lower fare levels, the traffic levels at PHL should, at the very least, approach 20-25 million O&D passengers per year when its traffic levels are viewed against the 30 million annual O&D passengers in the Washington-Baltimore region (with its somewhat higher population). I'd add that the Washington-Baltimore region probably hasn't completely matured in terms of low-fare stimulation yet.
10 million additional annual O&D passengers at PHL works out to about 133 daily 737-700 round-trips filled to 75% capacity, 365 days a year, ignoring any connecting traffic. I think it's pretty clear why Southwest thinks that Philly can provide dramatic growth prospects for their network, even absent the potential failure of US Airways.
If US Airways management wants to point fingers at anyone to blame for their predicament, they should point them right back at themselves. They have consistently failed to fix the pricing model which provides such attractive opportunities for the LCC's, and they have failed to remove non-value-added costs from the business. They continue to pursue confrontation instead of engagement with their labor unions (i.e. Airbus narrowbody heavy maintenance outsourcing, flight attendant voluntary furloughs, etc.).
The $49 walkup fare WN is offering between PHL and PVD is still 20 cents/mile. Even US Airways should be able to make a profit (or at least break even) at that fare level.
NIKV69 From United States, joined Jan 2004, 8458 posts, RR: 56 Reply 10, posted (5 years 8 months 3 days 6 hours ago) and read 1647 times:
Brons2,
Well said! USAirways is a drain on a lot of people, high fares, low moral and the end is in sight at this point. WN is a great airline. Why do people hate them?
Mojo89 From United States, joined Feb 2004, 123 posts, RR: 2 Reply 11, posted (5 years 8 months 3 days 2 hours ago) and read 1598 times:
I'm with you NIKV. I don't know why people hate WN. $26M in profit last quarter and 52 consecutive profitable quarters is hard to argue with. Good for them. In an industry that has lost more money in the last 10 years than it made in it's first 50 or so years, there's something to be said about a company that can continually turn a profit.
When the going gets weird, the weird turn pro. -Dr. Hunter S. Thompson
DCA-ROCguy From United States, joined Apr 2000, 3843 posts, RR: 53 Reply 12, posted (5 years 8 months 2 days 18 hours ago) and read 1515 times:
10 million additional annual O&D passengers at PHL works out to about 133 daily 737-700 round-trips filled to 75% capacity, 365 days a year, ignoring any connecting traffic. I think it's pretty clear why Southwest thinks that Philly can provide dramatic growth prospects for their network, even absent the potential failure of US Airways. If US Airways management wants to point fingers at anyone to blame for their predicament, they should point them right back at themselves.
Preach it, brother. For years Philadelphia has been an overcharged market, with O & D traffic far below what a population base of the Philly MSA's would naturally support. Good for WN, and good for Philly.
US Airways management and unions can thank themselves for the current situation. For years they acted like they were entitled to bleed people, artificially inflating the cost of air travel. Now US is on the receiving end of the IV, and they richly deserve it. More power to Southwest, Frontier, ATA, AirTran, and any other LCC that wants to enter, at Philadelphia.
AAJAXFlyer From , joined Dec 1969, posts, RR: Reply 13, posted (5 years 8 months 2 days 12 hours ago) and read 1396 times:
More power to Southwest, Frontier, ATA, AirTran, and any other LCC that wants to enter, at Philadelphia.
Great for you all in Philadelphia! I hope for your sake that US Airways goes bankrupt, you have all that great unemployment, and you lose service to most non-stop markets! But you'll still have that cheapo ticket to Orlando.....
DfwRevolution From , joined Dec 1969, posts, RR: Reply 14, posted (5 years 8 months 2 days 11 hours ago) and read 1341 times:
I hope for your sake that US Airways goes bankrupt
Honest to god, who actually hopes for someone to go bankrupt? I'm a huge WN fan, but I don't really want to see anyone out of work, I've been having enough trouble finding myself a job so I wish it upon no one.
That being said, the future of U.S. Airways does look dim.
MSYtristar From United States, joined Aug 2005, 5456 posts, RR: 55 Reply 15, posted (5 years 8 months 2 days 11 hours ago) and read 1324 times:
If Southwest keeps on building up PHL until they reach 80+ flights (that number seems very feasible), you know they'll hit just about all the major markets that currently see nonstop service from US. You can bet that every market in which WN and US compete with each other will be won...easily...by WN. Even if people pack the US aircraft, the prices will be so low that there would be no chance to make money in the market. The best hope for US would be to see Southwest not expand too rapidly and hopefully stay away from engaging in an all out war with them. Unfortunately for US, however, they don't exactly have the best track record against defending its turf from Southwest...and I can't imagine that they will defend it this time around.
If US hangs around for awhile (50/50 chance maybe less?), perhaps we'll see PHL turned strictly into a transatlantic hub, with feeder routes to the big leisure/business destinations, but far from competing on a flight-per-flight basis with Southwest.
Steve/MSY
UA's 744 Y-class seat is more comfortable than DL's new 77L Y-class seat.
Cory6188 From United States, joined Feb 2004, 2666 posts, RR: 9 Reply 16, posted (5 years 8 months 2 days 11 hours ago) and read 1286 times:
How bad will this be for CO with their hub not too far away at EWR? Granted, PHL may not pull people all the way from NYC, but they will definitely have an influence on Southern NJ.
Jetbluefan1 From United States, joined Dec 2003, 2602 posts, RR: 20 Reply 18, posted (5 years 8 months 2 days 10 hours ago) and read 1242 times:
Great for you all in Philadelphia! I hope for your sake that US Airways goes bankrupt, you have all that great unemployment, and you lose service to most non-stop markets! But you'll still have that cheapo ticket to Orlando.....
If LCC's do take over PHL, they obviously will have to hire LOTS of people. It's a darn good chance that most of the people hired will/would be former USAir employees. Chances are that these people will also be happier at their new airline as USAir has the suckiest record when it comes to management.
I only assume a couple of destinations will be ignored by LCC's, such as smaller upstate NY, cities in Maine, farm cities in Pennsylvania, and Tennessee. I'm sure AirTran would add flights to smaller cities, WN would do lots for the major cities, and B6 could come in and serve SYR, ROC, BUF, BVT, and much, much more when the 190's come in.
Yes, it is horrible to see an airline go, but if the airline is US, the other airlines will have absolutely no problem rehiring the former employees of the folded airline, and also will have no problem getting on the routes and actually giving people a decent fare.
US is getting what they deserve...
JetBluefan1
Most people on a.net hate JetBlue. Get used to it.
William From United States, joined Jun 1999, 904 posts, RR: 0 Reply 19, posted (5 years 8 months 2 days 10 hours ago) and read 1229 times:
I wander how the notorious PHL delays will effect SWA swiss watch operations?
As someone stated before,when US goes they may not receive all the nonstop service say.....from smallville since the LCCs cannot charge the same low fares to small towns via turboprops......but what the heck,according to many on this site they should just drive a couple of hours anyway.
DCA-ROCguy From United States, joined Apr 2000, 3843 posts, RR: 53 Reply 20, posted (5 years 8 months 2 days 7 hours ago) and read 1185 times:
As someone stated before,when US goes they may not receive all the nonstop service say.....from smallville since the LCCs cannot charge the same low fares to small towns via turboprops......but what the heck,according to many on this site they should just drive a couple of hours anyway.
One thing that's important to remember is that almost all of the US hub service to smaller cities is run by its Express partners. If there's a market for that service, the Express carriers will run it in someone else's colors.
Continental Express and Connection, for instance, could run a lot of this same service through EWR and CLE. United Express will probably pick up some through Dulles. And if a healthier network carrier such as NW wants to give it a go in Philly, which I think likely because of the big population base and int'l routes, a lot of it might stay right there.
AAJAXFlyer From , joined Dec 1969, posts, RR: Reply 21, posted (5 years 8 months 2 days 1 hour ago) and read 1140 times:
And if a healthier network carrier such as NW wants to give it a go in Philly, which I think likely because of the big population base and int'l routes, a lot of it might stay right there.
Doesn't make a lot of sense because then they'll find themselves in the same boat as US on routes where they must compete with the LCCs (such as the major business centers).
ORD2PHL From United States, joined Oct 2003, 280 posts, RR: 0 Reply 22, posted (5 years 8 months 2 days ago) and read 1102 times:
Like I've said time and time again, all the non-PHL area residents who are SO HAPPY to see WN do well here and kill US are completely clueless. The effect that the loss of US will have on our area will be terrible.
Lost jobs and lost non-stops to key cities. BUT HEY GREAT, I can get that cheap-o fare from Herby's airline to Florida or AUS, etc.
Bottom line, killing off of US in PHL is bad bad bad for the local economy and us frequent business travelers.
JrMafia90 From United States, joined Mar 2004, 214 posts, RR: 0 Reply 23, posted (5 years 8 months 2 days ago) and read 1102 times:
CO should jump on the bandwagon and come to PHL with more flights than it has now. Since I'm from South Jersey why would I drive up to EWR when I can go to PHL for a MUCH cheaper fare. I think this will hurt CO so they better do something about it.
STT757 From United States, joined Mar 2000, 12210 posts, RR: 55 Reply 24, posted (5 years 8 months 2 days ago) and read 1079 times:
" I think this will hurt CO so they better do something about it."
One of WN's largest stations is Houston Hobby, CO's largest hub is on the otherside of town at IAH. If CO can live with WN 30 miles from their largest hub they can live with WN 90 miles from their second largest hub.
"'Brown Sugar' could save the world..." Eddie Vedder 10/14/97 Oakland, California
DCA-ROCguy From United States, joined Apr 2000, 3843 posts, RR: 53 Reply 25, posted (5 years 8 months 1 day 23 hours ago) and read 1044 times:
Doesn't make a lot of sense because then they'll find themselves in the same boat as US on routes where they must compete with the LCCs (such as the major business centers).
Even with a large WN presence, PHL would probably support a network-carrier hub similar to UA's at IAD. NW's cost structure is 1-1.5 cents lower than US's (don't have latest figures). A network hub of say 50-60 daily mainline flights and 200-250 regional-feeder flights would probably be a viable operation to feed transatlantic nonstops to first-tier and second-tier destinations. Also, it would serve the small, but likely still existent, number business pax who want the various perks of a network carrier.
If WN does grow a big operation at PHL, the airport won't ever again see a network hub with the volume of mainline operations US has now. But the market's ability to anchor transatlantic nonstops, and large corporate community, will probably ensure that a small, heavily-regional network carrier hub by a carrier with CASM not above 9 cents probably can thrive.
The only people who are "clueless" are those who think keeping the Philadelphia's airfares high, and O & D emplanments below potential, are good for the Philly economy. Southwest has grown BWI's enplanements, employment, and need for terminal capacity, far beyond anything PI or US was ever able to do.
A big WN operation, plus a smaller, heavily-regional-and-transatlantic network carrier hub (the latter being something BWI of course *hasn't* even kept), offers PHL and the local economy much more potential than does the current situation.
Jim
26 Usairways85: Yea, while PHL travelers will have new low fares to choose from, if US does go, it will be horrible for PHL. I would expect much of the extensive cari
27 Aa757first: ORD2PHL, Agreed! I'm not exactly a PHL resident, but close enough to use PHL for flights (and on a different, note, spend tons of weekends in the subu
28 N670UW: If US Airways goes under, I see PHL becoming a lot like BOS. No one dominating hub carrier, but possibly a focus city or two from the network carriers
29 TxAgKuwait: A previous poster writes, and I quote: >> "Agreed! I'm not exactly a PHL resident, but close enough to use PHL for flights (and on a different, note,
30 William: No Tex,if its cheap enough people will not care about service.........Thats the real situation that exists today. In time we will all see this played
31 Wedgetail737: If PHL becomes a very big WN operation, I would like to see OAK-PHL nonstops and daily BWI-OAK nonstops.
32 ScottB: Aa757first says, "the thought of flying WN transcon, frankly, scares me. I have never flown them, but I can just imagine being stuck with a F/A using
33 N77014: What is interesting about the PHL expansion is that this is probably the quickest in WN's history. No doubt the rapid expansion is going to be expensi
34 OPNLguy: As an aside, SWA just made changes to the website that allows you to drag your mouse over SWA cities on a US map to display what non-stop service is o
35 PHLapproach: I went on USAirways.com saturday night at 11:30pm and I saw a $156.70 round trip nonstop PHL - FLL A321-200 there, 752 back. Hmmm, all these people co
36 Sccutler: PHLapproach- you seem to be missing the point; those fares would not be low, but for the new-entrant in the market, Southwest.
37 USAFHummer: Since WN hasn't started PHL-FLL yet and won't until July, the low fare there is most likely due to AirTran which also flies PHL-FLL non-stop... Greg
38 PHLBOS: Since WN hasn't started PHL-FLL yet and won't until July, the low fare there is most likely due to AirTran which also flies PHL-FLL non-stop... Greg,
39 PHLapproach: The fares were close to the same prices about 3 weeks ago. I got a roundtrip nonstop PHL - FLL last summer for $170. 752 both ways
40 PHLBOS: The fares were close to the same prices about 3 weeks ago. I got a roundtrip nonstop PHL - FLL last summer for $170. 752 both ways PHLapproach, Keep i
41 Scottb: I mentioned PHL's top 50 domestic markets in my previous post; here they are (along with the airlines offering non-stop service to those markets, incl
42 A330323X: Here's what I think. PHL currently has service (or announced service) to 117 airports. 40 of those airports have service by an airline other than US:
43 Jeffinbwi: Actually from a staffing standpoint, this could not have come at a better time. With staffing rolls being decreased across the system due to technolog
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