Concorde001 From United Kingdom, joined Jan 2005, 1230 posts, RR: 3 Posted (7 years 7 months 3 days 5 hours ago) and read 3900 times:
Personally, I think after BA/AA get ATI and competition brings US fares down, VS and BD will find it tough - very tough at LHR.
VS relies on its US routes for most of its profits, and the fact that VS has done so well over the years is due to the way in which Bermuda II has kept fares high. Competition from CO/DL/NW and BD will no doubt bring fares down, and with that VS will probably see its profits dwindle.
BD - the airline which doesn't have a clue! No doubt that BD will start services to the US, but I doubt BD will benefit much. People in the US and to some extent Britain just don't recognise the brand! Also, where will BMI get the aircraft to being US operations? After BA/AA get ATI, they will become, as Commavia pointed out in another thread, a powerful giant on UK-US / LHR-US traffic! I just don't think BD, even with its 14% slots at LHR will be able to compete effectively let alone VS!
So what is the solution.
Personally, now more than ever, a tie-up between VS and BD makes sense. VS's brand and BD's slots are a perfect match. Combined they could be a force to reckon with on LHR-US traffic.
But even with this, the age old problem of expansion at LHR causes problems for VS/BD. If VS/BD get together, and they want to survive in an Open Skies world where competition is fierce (and rightly so), I think they, and the British Government need to be radical. Open Skies I think gives once in a lifetime opportunity for the British Government to sort out the problem of airlines wanting to servce Heathrow rather than Gatwick. If the right infrastructure can be built at Gatwick, namely a second runway, new terminal, comprehensive rail links to the centre of London, possibly an Undergound link as well, the foundations will be laid for an airline to make LGW into a hub. Why can't London have two airports that have the same function as New York's EWR and JFK! LHR could be dominated by BA, and LGW could be dominated by VS/BD! LGW could become an EWR for VS/BD. They could thrive as alternative to LHR dominated BA/AA. VS/BD could make LGW into what CDG is for AF, LHR is for BA and FRA is for LH.
Perhaps I'm being naive, but I do think that a programme of the nature I have described could once and for all give airlines a PROPER choice as to which airport to use in order to serve London.
But as always, $$$ will decide!
Commavia From United States of America, joined Apr 2005, 10224 posts, RR: 62 Reply 1, posted (7 years 7 months 3 days 5 hours ago) and read 3867 times:
Quoting Concorde001 (Thread starter): Personally, I think after BA/AA get ATI and competition brings US fares down, VS and BD will find it tough - very tough at LHR.
Quoting Concorde001 (Thread starter): VS relies on its US routes for most of its profits, and the fact that VS has done so well over the years is due to the way in which Bermuda II has kept fares high. Competition from CO/DL/NW and BD will no doubt bring fares down, and with that VS will probably see its profits dwindle.
VS will survive, and they will still do well, IMO. There product certainly is differentiated -- very hip, youthful, and fresh, and service is generally good. However, no doubt -- as you say -- they are definitely going to face pricing pressure on transatlantic flying and will have far less to offset the subsequent revenue loss than BA, which will still have one of the world's largest longhaul networks -- much of it to high-yield destinations -- plus the AA link which will probably make up more than the difference in revenue.
BD is going to have a very tough time, I definitely agree. I could see BD perhaps doing LHR to JFK, IAD, and MIA. However, they are going to face enormous competitive pressure in every one of these markets -- all of which are already very well served -- by, among potentially others, AA, UA, VS and BA.
That is going to be a huge challenge for BD. VS and BA are already quite well known throughout the U.S., while AA, UA, CO and DL are all well known in the U.K. BD, on the other hand, has a miniscule presence in the U.S., having only 10 weekly flights from the U.K. They are definitely going to have a major uphill battle -- I think BD is going to face more challenges than any other carrier in the market, including VS.
Quoting Concorde001 (Thread starter): After BA/AA get ATI, they will become, as Commavia pointed out in another thread, a powerful giant on UK-US / LHR-US traffic! I just don't think BD, even with its 14% slots at LHR will be able to compete effectively let alone VS!
Commavia, hey, that's me!
Your point is very valid. Even if BD sets aside half its Heathrow slots for longhaul flights -- which it surely could never do -- it would still face all the same challenges you already highlighted and the juggernaut that is AA-BA.
I concur 100%. If this deal goes through, and Heathrow is opened up, I expect a bmi-Virgin merger within five years. Given the intense competition that will ensue from four new U.S. airlines, together with an enormously strengthened and bolstered AA-BA alliance, I don't think that limited codesharing and interline connectivity over LHR is going to cut it anymore for these two small U.K. airlines. They will have to merge just to keep up.
Thanks Commavia - by the way whenver I read your posts you always make excellent, intelligent points and alot of sense!
Back to the topic....
I think if Sir Michael Bishop (Chairman of BD) decides to force LH to buy his 51% stake in BD in addition to LH's 30% (which he can do by using the agreement signed between LH and BD in 1999), we might see LH operating transatlantic out of LHR! VS will need to be quick and offer something attractive to Bishop if this is to be avoided.
ANother From , joined Dec 1969, posts, RR: Reply 3, posted (7 years 7 months 3 days 4 hours ago) and read 3805 times:
Couple of thoughts to add ...
1. Having an US-EU 'open skies' is unlikely to grow the market - even with lower fares this is a very mature market and I would guess that 10% growth would be the maximum.
2. Opening up Heathrow to other US and British carriers (or additional ops by BA/VS) will mean what? CO can't just apply for a 0630 arrival from EWR with a paired departure of 0800 - they will likely have to buy (or more correctly trade with an enhancement). How likely is this? They would be better expanding their code shares with existing operators with VS.
3. European carriers are unlikely to view LHR-US ops as being in their interests. The slots they own (to their hubs) are likely to be much more valuable as they are then used for adventures to the new world.
4. BD will likely sacrifice their short-haul ops to be 'one of the big boys'. Sound familiar? Short haul ops will be abandoned for being able to serve the Big Apple, and GWBs home town. Might get some star code shares but can they really compete here.
5. A lot of hot air, coming out of Brussels. They have failed to get access to US cabotage routes or at change in US ownership laws - stated goals. (which IMHO a waste of O2) - but this is a success? These guys are so desperate for an agreement, any agreement that they have sold their soles.
Commavia From United States of America, joined Apr 2005, 10224 posts, RR: 62 Reply 5, posted (7 years 7 months 3 days 4 hours ago) and read 3735 times:
Quoting ANother (Reply 3): Having an US-EU 'open skies' is unlikely to grow the market - even with lower fares this is a very mature market and I would guess that 10% growth would be the maximum.
Huh? With due respect, I wholeheartedly disagree. It is a proven fact that virtually ever time -- since 1992 -- than the U.S. has signed an 'Open Skies' deal with a European nation, traffic between the U.S. and that nation ultimately increases and fares come down.
This agreement will lift restrictions on capacity, schedules, routes and pricing, and will almost certainly lead to a fairly sizeable expansion of the market, IMO.
Quoting ANother (Reply 3): CO can't just apply for a 0630 arrival from EWR with a paired departure of 0800
No, but they can buy the slots if they are willing to put up that kind of money.
Quoting ANother (Reply 3): they will likely have to buy (or more correctly trade with an enhancement)
Very. Continental and Delta have been desperately trying to get into Heathrow for years. To come this far, and finally get access to Heathrow -- even without slots -- they will certainly pay whatever it takes to get the Heathrow slots they need. (And, IMO, that's the way it should be. Why should Continental and Delta get for free what it cost AA and United more than $700M to get?)
Quoting ANother (Reply 3): They would be better expanding their code shares with existing operators with VS.
No they wouldn't. Continental has next to no interest in continuing to dump their Heathrow-bound passengers on to Virgin if they can have their own planes landing at the world's most prestigous airport. In fact, I predict that within two years of Heathrow being opened up, Continental will have established a presence there, and within two years of that, the Continental-Virgin codeshare deal will go away.
Quoting ANother (Reply 3): European carriers are unlikely to view LHR-US ops as being in their interests.
Agreed. All this talk about Lufthansa or Air France flying from Heathrow to the U.S. is unrealistic. Since the European Common Air Market opened, with predictions that soon we would see formerly national airlines plying routes inside other European countries. Generally, outside the low-fare sector, this has not happened at all, and I doubt it will happen between Heathrow and the U.S.
Quoting ANother (Reply 3): A lot of hot air, coming out of Brussels. They have failed to get access to US cabotage routes or at change in US ownership laws - stated goals.
"They have failed to get access to U.S. cabotage routes."
Well, since the E.U. apparently had a revelation in the last year and realized that there is literally a 0% chance of the E.U. ever securing access to the domestic U.S. market for E.U. airlines, they apparently felt this was a fairly good deal to get. I happen to agree with them.
This achieves the key, bottom-line, objective that both sides wanted -- unrestricted flying between the U.S. and E.U. While the E.U. wanted domestic U.S. access, it was never going to happen, and they were smart to just let it go.
As for the ownership laws -- according to several articles, this contract's coming into force is at least somewhat contingent on lifting of the ownership cap for U.S. airlines (presumably to 49%). With a little political maneuvering on Capital Hill (and intense lobbying from airlines who want to see the deal done -- most of all AA) I don't think that is unrealistic at all.
These talks opened to doom-and-gloom predictions, and rumblings that if a deal didn't get done within a few years, the E.U. might take the bold step of renouncing all the bilaterals between the U.S. and E.U. member states.
Today? Everyone is celebrating that the deal the whole aviation world that was unatainable for decades was done in a matter of days.
FlyCaledonian From United Kingdom, joined Dec 2003, 1971 posts, RR: 3 Reply 6, posted (7 years 7 months 3 days 1 hour ago) and read 3631 times:
Small piece in the financial pages of todays Daily Mail regarding the BA view on this. Expectation that no deal will be formally signed til March next year at the earliest (There had been hope for this by the year end). This isn't stating the deal won't go through but that dotting the Is and crossing the Ts will take the time.
BA view that some changes in ownership rules will have to take place at sometime. Frustrated that limits will restrict potential tie-up with AA. IMHO this could actually favour BA as if ownership rules are altered later on as part of further talks, say a few years down the line, then we should actually see a more mature, competitive market already operating from LHR. Remember when BA/AA last went for a tie-up and baulked at the number of slots they were expected to relinquish at LHR? Also suggestion that some destinations may lose flights as a result of competition, in BA's case NW operating DTW-LHR and US PHX-LHR could see BA drop these routes if yields were hit hard enough.
BA has to be the short-term winner from this deal. It will be able to switch the remaining longhaul (excluding MCO/TPA) ops from LGW, namely ATL, DFW and IAH, because it has the slots it can free up from shorthaul. As for new routes, hard to say. Again, has the slots, but will it want to? Potential to convert the remaining shorthaul 767s to longhaul to launch new operations, but it all depends on whether the people down at Waterside have their eye on any particular markets. Longer term might speed up a BA 773 order as 744s might become too large (particuarly in economy), especially as you're likely to see BD and DL trying to enter the LHR-JFK market.
AA has the LHR infrastructure, but it will have to acquire the slots to get its RDU and DFW operations moved across from LGW. It will have no need to maintain a LGW base. Potential that AA might even consider STL-LHR, even seasonally.
UA has been moving to concentrating its LHR ops on its hubs in recent years, i.e. IAD, ORD and SFO, plus the flights to JFK and LAX. IMHO the remaining JFK flight will go in favour of a DEN flight. JFK could still be offered via a codeshare with bmi. With this deal on the cards though I was surprised UA signed that five year deal with VS to lease the slots from the JFK rotation that was dropped. Saying that, with slots leased to several carriers UA has the future option to expand LHR ops when those leases expire.
VS, since 9/11, has looked beyond the US for expansion, so lessening its exposure to this market. Plenty of opertunities, but, for want of a better phrase, we'll continue to see VS cherrypick its destinations. I'd actually expect more expansion from LGW to leisure orientated destinations that the limits of BII actually prevent it from serving. The prize of BD would have to be attractive, if only to bring in strong domestic feed in VS colours. VS also has been the only carrier to express interest in US-EU ops. Again, this would be on select routes that VS would view as good yield earners, e.g. JFK to FRA or CDG, and there wouldn't be many.
BD has the slots. That's about all you can say! Brand recognition in the US is limited and it will need longhaul aircraft in a hurry. Be interesting to see if they cut and run in MAN to get a couple of A330s to LHR. Routes? JFK and MIA would be favourite, possibly LAX and BOS. IAD, ORD and SFO can be covered by the UA codeshares. These two working together could get a good dozen destinations served. Longterm though VS would have to be considered a potential groom, though maybe LH might want to try its hand? Longshot idea I know, but it would be the one European carrier that could operate from LHR under its own brand. Keep the domestic and CDG, DUB, CDG, BRU and AMS flights (regular frequency for feed) and use remaining slots for longhaul.
CO is the carrier you would expect to make it into LHR first. It's also the only LGW carrier who I would expect to maintain service there (752 to EWR most likely) apart from the BA/VS leisure flights. You'd expect an increase in EWR frequencies, maybe IAH too, while CLE could go all-year.
DL is the one carrier who could look at new destinations, i.e. JFK and possibly BOS or even LAX, with LHR operations. ATL and CVG would move to LHR too, though maybe one annual, or seasonal ATL service might remain at LGW. Maybe even SLC would gain a service. Problem for DL would be acquiring those LHR slots - without the slots can't expand UK ops, but can it justify the acquistion costs whilst in Chapter 11?
NW would be a niche LHR operator. Would need to acquire the slots for DTW and MSP service, which while in Chapter 11 might be a problem. Be interesting to see if BA maintained DTW if NW was operating from LHR, as BA already uses the 767, its smallest longhaul aircraft.
US is the carrier to me who might not rush to enter LHR. Depends if the management want to take US there, or maintain LGW. As with the other US carriers slot acquisition is the issue, though maybe Star partner UA might look at selling US slots that are leased to other carriers as these leases expand. Again, potential for new route with PHX-LHR, and as with DTW, potential that BA might be driven off this route if enough damage was done (BA has already lost the HP codeshares that connected into the PHX flight).
All of this is just my take on what the various carriers may do with an open skies deal in place. Plenty up for grabs, and I think it can only benefit the UK-US market (as well as the wider EU-US) market. Lots for plenty of people to think about, especially Sir Michael Bishop and his team at Castle Donnington.
JoFMO From Germany, joined Jul 2004, 2211 posts, RR: 0 Reply 7, posted (7 years 7 months 3 days 1 hour ago) and read 3631 times:
Where was it written that BA and AA will get ATI now?
I don't see why the US side should grand them ATI as long as most other US legacies doens't have slots at LHR. I remeber that LH and OS as they teamed up and later on LH/LX following their cooperation had to give up a significant amount of slots to get an ATI.
So as long as CO/DL/US/NW have a sizeavble amount of slots in LHR I don't see an AA/BA ATI come throught.
Probably one of the best summaries of the situation so far written.
Given a total Open Skies agreement, no doubt many will want a slice of the action, but can they afford the slots at LHR? Those don't come up often, and when they do they are expensive. Perhaps this could be the golden goose for BD, who could sell off a whole bunch of their slots and change again into a VS-style longhaul operator fat with captial.
Alternatively, VS could buy BD (a marriage often speculated on), and shake up the network completely - finally offering a real competitor to BA (although they'd need a lot of new metal, and that would require more cash than I think SRB has to hand at the mo.)
BA will of course abandon LGW just like they've abandoned the north of England. With no restrictions on which longhaul airports they can fly to from LHR, the whole ballgame will be concentrated on T5 - an BA have the slots to implement it.
FlyCaledonian From United Kingdom, joined Dec 2003, 1971 posts, RR: 3 Reply 9, posted (7 years 7 months 2 days 21 hours ago) and read 3511 times:
Maybe Open Skies will prompt LHR to move towards dual runway use to increase capacity. Big issue until 2008 will still be Terminal capacity though, even if the US majors get the LHR slots. After that we'll see, if all goes to plan, BA in T5, OneWorld in T3 (With VS), Star in T1 and SkyTeam and non-aligned carriers in T4. T2 demolition opens the way for the construction of Heathrow East, eventual home of Star and VS (If it goes ahead).
One thing is for certain - as regards slots in the early morning it will be a sellers market.
Pixuk From United Kingdom, joined Dec 2003, 322 posts, RR: 3 Reply 10, posted (7 years 7 months 2 days 21 hours ago) and read 3482 times:
I don't see VS ever joining Star - it's simply not in their interest. They have plenty of independant partnerships were it suits their needs, but they have no desire to open up their exclusive benefits (such as the LHR Clubhouse) to Silver-touting *A punters.
DarthRandall From United States of America, joined Mar 2005, 302 posts, RR: 4 Reply 11, posted (7 years 7 months 2 days 20 hours ago) and read 3461 times:
Quoting Commavia (Reply 1): BD is going to have a very tough time, I definitely agree. I could see BD perhaps doing LHR to JFK, IAD, and MIA. However, they are going to face enormous competitive pressure in every one of these markets -- all of which are already very well served -- by, among potentially others, AA, UA, VS and BA.
I can see them trying that, too, although I hope they will instead stretch routes further into the continent to places like, say, PHX or MSY. places like that would be nice alternatives for folks in the Southwest or on the Gulf Coast who would rather avoid the hastles of JFK, ATL, or LAX. The best way to compete I think is to offer something different from what is already being offered.
STARCREW From United Kingdom, joined Oct 2004, 88 posts, RR: 0 Reply 12, posted (7 years 7 months 2 days 19 hours ago) and read 3421 times:
Well bmi seem to have landed on their feet for once. Will they capitalize on this situation? Going on their previous decisions probably not. Yes LHR -US has always been the cherished aim of SMB ( some would say an obsessive dream) but lets look at the facts.
1. This deal will not be signed until atleast march 2006 that's assuming there is no maneuvering by all interested parties and a clear ride from the senate. bmi have only 3 A330's and already have more work for them than they can handle. Spare A330's are very hard to find and very expensive. bmi's financial health is not good and there is no pot of money for big capital investment.
2.Maybe more 767's as the recently wet leased ac to cover MAN/LAS/BGI etc... but these aircraft ruin the "all airbus one fleet policy " braught in 2 years ago to minimise cost. Also it will be expensive to refit these aircraft to the 3 class bmi model (PTV's etc). plus it weakens the brand.
3. New aircraft? A350? cheap deal 787? Boeing would like the business back I'm sure but again no aircraft available till 2007/8.... plus $$$$$'s bmi don't have any.
4. bmi's product - no lie flat beds, pay for drinks in ecy, low brand recognition. lot of work needed.
6. Frequency - never a bmi strongpoint (see BOM). atleast 6-8 widebodies needed to start 3 routes to US with anything like a competitve frequency eg BA has 8 flights a day to JFK, VS have 3. bmi 1 any good to a businessman?
All in all VS should just buy bmi for the slots alone, discard the bmi brand , keep a few feeders Uk domestic and AMS BRU MAD DUB CDG LIN.
ANother From , joined Dec 1969, posts, RR: Reply 15, posted (7 years 7 months 2 days 11 hours ago) and read 3268 times:
Quoting JoFMO (Reply 7): I remeber that LH and OS as they teamed up and later on LH/LX following their cooperation had to give up a significant amount of slots to get an ATI.
Well - yes but. LH/OS had to promise to give up slots to be used on the FRA - VIE route I think the EC actually convinced Croatian to operate the route, but they dropped it after a few months. Who, in their right mind, would go up against 600kg twins on their hub-to-hub routes? The reality is that neither LH nor OS gave up any slots.
SamL From United Kingdom, joined Jul 2004, 162 posts, RR: 0 Reply 16, posted (7 years 7 months 2 days 9 hours ago) and read 3196 times:
with regards to the practicality of LGW as a serious alternative to LHR, I'm not sure I can really see this happening soon.
Rail links to London from LGW are by far and away the best of any airport in London, in fact of any airport in Britain, direct trains to Victoria, Blackfriars, Kings Cross and LTN as well as numerous suburban stations in both south and north London via Thameslink trains and the services from Gatwick to Watford Junction via Clapham Junction and Kensington Olympia. Also excellent rail links to Brighton, Tonbridge, Reading, Guilford etc etc.
Putting LGW on the underground network would entail a huge investment for no real return, LGW is a long way outside the existing network (unlike LHR and LCY) and the an extension would really only replicate what the existing slow trains to Victoria already do.
A new runway won't be likely before 2019 due to the famous agreement signed when LGW was last expanded. This seems fair as what is the point of signing agreements if they don't you can just go back on them later. This is the sort of corrupt government we continually look down on, not something to be emulated.
Even if all this could somehow be put in, LGW doesn't have the same prestige as LHR and is notorious for low numbers of business passengers compared with LHR. I think it is very unlikely that VS / BD would be willing to abandon LHR for LGW, if they did they would be taking a huge risk. Aside from Central London, LGW is much further from the very wealthy Thames Valley and northern homecounties and places like Swindon, Oxford and Bristol etc (although I accept it would have Surrey / Kent etc).
Basically, an interesting idea but I can't ever see it being practical but hey, what do I know! Other thoughts welcome...
Commavia From United States of America, joined Apr 2005, 10224 posts, RR: 62 Reply 17, posted (7 years 7 months 2 days 8 hours ago) and read 3167 times:
Quoting FlyCaledonian (Reply 6): BA has to be the short-term winner from this deal. It will be able to switch the remaining longhaul (excluding MCO/TPA) ops from LGW, namely ATL, DFW and IAH, because it has the slots it can free up from shorthaul.
Agreed. Despite BA's posturing about ownership rules to the contrary, I think everyone -- including BA -- knows that they will be the single biggest benificiary of this deal. They are going to finally be able to operate a true hub at LHR that will be competitive with AF-CDG, KL-AMS and LH-FRA, and probably be able to get expanded alliance rights with their partner-of-choice, AA.
Quoting FlyCaledonian (Reply 6): AA has the LHR infrastructure, but it will have to acquire the slots to get its RDU and DFW operations moved across from LGW. It will have no need to maintain a LGW base.
I could see them potentially keeping 1 daily flight at LGW, as many people do like it, but otherwise moving everything to LHR once they get slots, as you say.
Agreed. Given the choice, UA would drop JFK-LHR in an instant in order to link their second largest hub (I think?) with LHR, IMO.
Quoting JoFMO (Reply 7): Where was it written that BA and AA will get ATI now?
Nowhere. Many (including myself) are acting on the presumption that Open Skies will lead to ATI, as it has in the past for just about every other bilateral the U.S. signs. While slots would be an issue, they would be a dramatically diminished issue, as now the issue of route authorities wouldn't be in question.
In other words, in the past, AA-BA was held up because competitors were locked out of Heathrow for two reasons: 1) Bermuda II route restrictions and 2) no slots. Well, if this deal goes through, #1 will go away, and it will be only #2 for the U.S. carriers to deal with, and all of them will be more than happy to pitch in for slots.
Some excellent points.
I was wondering though, how do EWR and JFK cope? By that I mean how do both airports remain almost equal in status as NYC's major international airport (even though one is in NJ) with healthy high yielding business traffic, while in London, only LHR is in this position?
I don't think geography has much to do with it - LGW is not technically in London, neither is EWR technically in New York. But maybe there is more to it - enlighten me people!
FlyCaledonian From United Kingdom, joined Dec 2003, 1971 posts, RR: 3 Reply 19, posted (7 years 7 months 2 days 8 hours ago) and read 3145 times:
Commavia, I agree AA may want to keep a DFW flight at LGW. At least with the BA operation there a lot of the handling, check-in, etc could even be passed over to BA. Be interesting to see what happens if AA/BA get ATI, i.e. does AA look at a small operation into LGW of say daily from DFW, JFK, ORD, and possibly BOS and MIA, that can be codeshared with BA and that can feed the BA/GT shorthaul network from LGW that is now very much geared towards the Mediterranean. Remember, apart from Rome and Milan, all BA's flights to Italy operate from LGW, and apart from Paris and Lyon, all BA's flights to France likewise operate from LGW. I know it's similar with Spain, but then there is the IB link through MAD for connections there.
On that note does anyone think AA might therefore look at moving an ORD or JFK flight to LGW in order to move 1 or 2 DFW flights to LHR in the short-term?
Commavia From United States of America, joined Apr 2005, 10224 posts, RR: 62 Reply 21, posted (7 years 7 months 2 days 7 hours ago) and read 3112 times:
Quoting FlyCaledonian (Reply 19): At least with the BA operation there a lot of the handling, check-in, etc could even be passed over to BA.
This already happens. AA has its own passenger service staff at LGW, but everything else (lounge, ramp, etc.) is handled by BA. BA got the contract over from Servisair about a year ago, IIRC.
Quoting FlyCaledonian (Reply 19): Be interesting to see what happens if AA/BA get ATI, i.e. does AA look at a small operation into LGW of say daily from DFW, JFK, ORD, and possibly BOS and MIA, that can be codeshared with BA and that can feed the BA/GT shorthaul network from LGW that is now very much geared towards the Mediterranean.
I doubt it, as most of the LGW-Med flights are not timed well for connections to or from the U.S., anyway, even with AA's 4 daily LGW flights. They are timed for early LGW departures, and late night arrivals back, which misses transtlantic flights at both ends.
My guess is that if AA and BA were to get ATI, they would shift all their codesharing over to LHR, which BA would no doubt try to expand, and in turn continue to put more and more southern Europe-bound travellers on to SN over BRU.
Dutchjet From Netherlands, joined Oct 2000, 7864 posts, RR: 58 Reply 22, posted (7 years 7 months 2 days 7 hours ago) and read 3098 times:
Some very well reasoned and excellent posts, thank you!
Let me make some predictions:
BA - after all of the drama, I think that BA will be the big winner here. More flights to/from the US into LHR will allow their hub and network at LHR to grow and could increase revenue in a big way. BA has the slots and the power at LHR and will benefit from the situation. Look for BA to move all US/London operations to LHR and for more service to more US cities. Also look for BA to take advantage of 5th freedom rights out of the US.
VS - although VS claims to offer a unique product and has a loyal following, VS is less special than they were years ago. Without connection possibilities at LHR, limited slots at LHR, and more competition, they could be on the losing end of this deal.
BMI - their goal, for years and years, has been to offer service from LHR to US cities - this is now their big chance, the question is whether BD can make this work (their strategy in the past years has been confusing at best)....with a small A330 fleet, BMI can only open a few routes (JFK, ORD and MIA would be my guess - those cities were mentioned in the past) and they can only do that if they cut the MAN-ORD flight (I dont think BMI has much real interest in MAN anyway) but what about BMI's new services to India and the Gulf - will those simply be cut when this deal goes into place. BMI does offer connection possibilities out of LHR which is a good thing, but their European network from LHR is not as strong as it once was.
CO - I believe that CO will do what it has to secure slots at LHR in order to operate two flights per day to IAH, two flights per day to EWR and a daily flight to CLE. CO has done well in the UK, its a known product and CO has good, well situated hubs with many connection possibilities, they will do well at LHR. CO may also retain service to LGW, with a daily EWR-LGW flight operated by the 757.
DL - has been dreaming about getting into LHR for years (as if that would be the answer to all of its problems), but do they have the resources to secure slots at this difficult time in DL's history? DL's alliance partners offer connections at CDG, AMS, MXP and FCO - so LHR is only important as far as pax going to and from London who want LHR over LGW. DL also seems focused on getting into the lucrative JFK-LHR market.......this could get difficult and DL has other problems to content with.
NW - with its huge operation at AMS, London is not that important to NW. NW is another airline with limited resources and other problems to work out, thus I dont think that LHR will be a big priority for NW.
AA - will be a big winner, consolidating its London operations at LHR and adding frequencies and possibily new routes. AA will do what it has to in order to move the Dallas-London flights over to LHR, service on Miami-London is bound to increase and we could see some other surprises such as SJU-LHR or STL-LHR depending on the cost of slots.
UA - UA's strategy for London, and Europe in general, is hard to figure out. UA's close relationship with LH and connections at FRA, combined with the fact that UA already has LHR access (which it has not used to its full potential), plus UA's continued financial issues make this hard to predict. Denver-Heathrow will be added, but I dont know about much more expansion.
US - may take a pass and stay at LGW - I am not sure that US will benefit greatly by moving over to LHR - so much depends on the slots, what they cost, and competition. US will not lead the way here, I think that they will take a conservative approach and follow the competition.
Has anything been said concerning slots at LHR in respect to this proposed deal - I may not be up to date, so I apologize, but will any new slots be created at LHR to accommodate this deal? Will any existing LHR carrier be required to turn in some slots? Or, will access be granted and the airline must go into the market to obtain slots at LHR? As we know at NRT, access in one thing, slots is another.
I do hope that a deal has been reached, Bermuda 2 is problematic for all concerned and it is time to move along.
Concorde001 From United Kingdom, joined Jan 2005, 1230 posts, RR: 3 Reply 23, posted (7 years 7 months 2 days 7 hours ago) and read 3058 times:
Quoting Dutchjet (Reply 22): VS - although VS claims to offer a unique product and has a loyal following, VS is less special than they were years ago. Without connection possibilities at LHR, limited slots at LHR, and more competition, they could be on the losing end of this deal.
VS doesn't rely upon connections anyway - so I don't see the fact that they don't have connections to Europe etc as a problem. We need to remember the reason why VS is able to make money from LHR as a longhaul operator is because London has a huge O & D market, one of the largest in the world. The problem VS face is the age old one of LHR expansion constraints. VS will need more slots, loads more in fact to compete effectively with BA/AA on frequency and variety of destinations served from LHR to the US.
JoFMO From Germany, joined Jul 2004, 2211 posts, RR: 0 Reply 24, posted (7 years 7 months 2 days 5 hours ago) and read 3003 times:
Quoting ANother (Reply 15): Well - yes but. LH/OS had to promise to give up slots to be used on the FRA - VIE route I think the EC actually convinced Croatian to operate the route, but they dropped it after a few months. Who, in their right mind, would go up against 600kg twins on their hub-to-hub routes? The reality is that neither LH nor OS gave up any slots
Sorry, but you are completely wrong!
Os/LH had to give up 3 slot pairs between VIE-FRA to get their cooperation through. The slots were picked up by AdriaAir (JK) and they still fly 3times daily with a CRJ.
Although JK is now a regional partner In Star, they weren't at that time. LH and OS were even forced to give JK's customers Miles&More points so that they doesn't have an advanture due to their frequent flyer advantage.
If you try to book with Expedia you can see, that JK still effectively competes with LH/OS on the route. Joint service flights of OS/LH can be booked for 503Euro, while JK only costs 449Euro.
25 GoCOgo: That is one of my huge questions as well. To me, it would seem pointless to grant new access the other US carriers and BMI if they can't give some lo
26 Pixuk: The fact it's only 49% means SQ's opinions don't actually mean that much. VS only do things that suit them, and just because SQ are in Star isn't eno
27 FlyCaledonian: As regards forcing anyone to give up LHR slots, and most people would look at BA here, I think a whole host of legal issues would arise if it was said
28 JoFMO: It is interesting to read the old DOT conditions for an AA/BA ATI. I have them saved in 2002 and would like to post them here. I don't think that the
29 Sevenforeseven: flycaledonian and scotron11 you say VS "cherry picking" routes, well VS are in the airline business for making money and ONLY flying routes that make