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How Is Legend Airlines Doing?  
User currently offlineAA@DFW From United States of America, joined Sep 2000, 397 posts, RR: 0
Posted (13 years 11 months 1 week 2 days 1 hour ago) and read 1548 times:

I recently read that Legend has posted a $10.8 Million dollar loss since beginning operations. That's quite a slam, but is that normal for a start up carrier? I am fairly confident that Legend will have to file for bankruptcy and liquidate its assets within the next 3-4 years. There simply is not a SUBSTANTIAL market for the service they provide now, they spent too much principle in their new terminal, the old DC-9s are too old and require extreme amounts of maintenance, and they've entered a market (DAL) that is dominated by American and to some extent Southwest.

I predict Legend will be extinct by the year 2004 (if not sooner).

14 replies: All unread, jump to last
 
User currently offlineAA737-823 From United States of America, joined Mar 2000, 5817 posts, RR: 11
Reply 1, posted (13 years 11 months 1 week 2 days 1 hour ago) and read 1496 times:

Keep in mind that they are doing better than American in Southwests territory, and that Legend was there before American. I hope they last thru October, as I have tickets to DC on them!!!

User currently offlineAA@DFW From United States of America, joined Sep 2000, 397 posts, RR: 0
Reply 2, posted (13 years 11 months 1 week 2 days 1 hour ago) and read 1484 times:

That is interesting. Is LA getting more pax than AA? I heard a news report 6 months into each carriers DAL operation on WBAP (A Dallas based AM news radio station) that AA had higher load factors than LA and is performing significantly better in areas such as on-time performance. Has the load factor issue shifted hands? Is LA now holding more passengers than AA? Do any of you know if either airline has dropped or added and frequencies of flights? I'm curious as to anyones insight.

User currently offlineNotdownnlocked From United States of America, joined Sep 2000, 935 posts, RR: 1
Reply 3, posted (13 years 11 months 1 week 2 days 1 hour ago) and read 1477 times:

From what I had heard AA was calling their FF's and trying to convince them to try the new DAL flights which is effectively cannibalizing their PAX counts at DFW. I have heard Legend is carrying more PAX from DAL but is also running more flights. I've also heard through PAX reports that AA has downgraded their services. Legend had a lot of startup capital and 10-11 million is not that much considering they fought in court for 2+ years against AA and getting the Wright Amendment changed. They also had enough to acquire planes and build their new terminal/parking area before a single penny was made from PAX revenue. Look for them to be around a while.

J.


User currently offlineDC-9CAPT From , joined Dec 1969, posts, RR:
Reply 4, posted (13 years 11 months 1 week 2 days 1 hour ago) and read 1473 times:

Hey AA@DFW:

The Clue Plane just pulled into the gate and you have a seat in 1A.

1. The "old" DC-9s of Legend have a better dispatch reliability rate than your F-100s.

2. Any economist or financier will tell you that you NEVER analyze the performance of a company on SUNK costs. Which is exactly what "the principle" that you are referring to is. Perhaps this initial and wise outlay for the terminal is wrapped up in the $10.8 million dollar "loss" that you are referring to. In which case it isn't a loss at all.

3. If you actually believe that there is no market in Dallas for the likes of Legend then AA would be flying the same routes with its jungle jets in all-coach configuration. Furthermore, AA would have never gone to court and fought tooth and nail to stop an entrant into the market. AA is running scared with its tail between its legs. By the way, you don't see WN reconfiguring their 737's with red leather lazy boys, galleys to serve 3 course meals, and DTV dishes, do you?
American has had to re-invent their business strategy on route pairings out of DAL because Legend is, OH MY GOSH, focussing on something unknown to most major airlines today: CUSTOMER SERVICE!! No market, my A$$.

4. People like you were playing the funeral dirge for YX in 1984. I haven't heard it for the past 11 years and certainly the past several that I have worked there. Folks like you also said YX would NEVER make it in OMA, MKE and MCI. "There's no market there". Hmmm. Seems to me all three are doing quite well. I guess I forgot to mention....three top execs at Legend come from and follow the same successful model as....YX!

You can rest assured that I will try to research some of the financials for Legend while I wait on short call today here in my crash pad.

My prediction is that AA will do away with their "good" customer service on the F-100s and compete with Legend on the Jungle Jet (where it can range-wise) by the end of next year.


User currently offlineSccutler From United States of America, joined Jan 2000, 5519 posts, RR: 28
Reply 5, posted (13 years 11 months 1 week 1 day 23 hours ago) and read 1446 times:

Strictly anecdotal; I'll try to track down more substantive info; but in researching some fares for travel in the next month or so, it appears that Legend must be filling some planes up pretty well; the LGA flights, in particular, seem to be selling out all of the discounted capacity right away.

My experience, early on, suggests that they are doing pretty well, especially for a start-up with Goliaath gunning for them.

These guys are not amateurs, and their service (especially for O&D at DAL, with that unbelieveably convenient terminal) is winning a lot of converts.

I believe AA may have your facts reversed, but we'll see.



...three miles from BRONS, clear for the ILS one five approach...
User currently offlineFalcon Flyer From United States of America, joined Jul 2000, 1325 posts, RR: 0
Reply 6, posted (13 years 11 months 1 week 1 day 23 hours ago) and read 1437 times:

Excellent point about Midwest Express. When everyone was predicting doom for the carrier, they just stayed on course and have thrived. Legend could do the same, if the company stays on course. My ex-CP is a line FO there and told me of plans for 6 more -9's. American would have never put the time, money and resources into battling Legend if they didn't think there was something there. AA can't win at Love. They tried to go up against SW to Austin with F-100s and MD-80s and got slaughtered. They downgraded to the jungle jet and still failed. As big as a monster that AA is, there are places where they can't compete.


My definition of cool ? Not trying so hard to be cool.
User currently offlineTWAneedsNOhelp From , joined Dec 1969, posts, RR:
Reply 7, posted (13 years 11 months 1 week 1 day 22 hours ago) and read 1427 times:

If you ask me, the DL SkyMiles linkup was huge. With Dallas a large SkyMiles market, Legend can compete head on with AA in terms of price, FF accrual, service, and location. Only thing is, Legend wins in service and location!

I think they have a future.


User currently offlinePilot1113 From United States of America, joined Aug 1999, 2333 posts, RR: 11
Reply 8, posted (13 years 11 months 1 week 1 day 22 hours ago) and read 1421 times:

I'm doing a report on them in about a month. Any info that you folks can dig up would be much appreciated!

- Neil Harrison


User currently offlineSccutler From United States of America, joined Jan 2000, 5519 posts, RR: 28
Reply 9, posted (13 years 11 months 1 week 1 day 20 hours ago) and read 1416 times:

Check out this prior thread, which includes references to published information which tends to put the lie to AA@DFW's contentions regarding relative pax and ASM's; is there new data out, or is AA confused?

http://www.airliners.net/discussions/general_aviation/read.main/276926/

Also, direct reference to a Dallas News article is:

http://www.dallasnews.com/business/169507_love_14bus.ART.html

If there is new data, I'd love to see it. From here, it looks like Legend's flying high. And, I think their Delta affiliation is a big plus, along with ASA's use of the same terminal (you gotta see this place!) for DAL flights.



...three miles from BRONS, clear for the ILS one five approach...
User currently onlineLoneStarMike From United States of America, joined Jul 2000, 3826 posts, RR: 33
Reply 10, posted (13 years 11 months 1 week 1 day 19 hours ago) and read 1406 times:

This is the most recent article about Legend which ran in the Dallas Morning News:

Legend shows loss of 10.8 million Early performance by start-up carrier expected, CEO says
10/12/2000

http://www.dallasnews.com/business/189761_legend_12bus.A.html

The fight between AA and Legend could be made into a mini-series. I sometimes feel it all comes down to Dallas vs. Ft. Worth. Dallas-based Legend vs. Fort Worth-based American.

Pilot 1113, I don't know how indepth your paper is supposed to be, but these articles might help. I like to think of it as Battle of the Love (Field) Shack: The Mini-series.

Although it's a bit dated, here's an interesting article on Legend from the Dallas Observer that gives a good history of what they've been through and what they have planned for the future.

Loaded for takeoff
01/06/2000

http://www.dallasobserver.com/issues/2000-01-06/news2.html

Although these articles are also old, they are two of the best (or at least most interesting) I've come across regarding the whole issue of Dallas, Ft. Worth, American, Legend and the Wright Amendment. The first one is really really long (and juicy; reads like a tabloid) and they both give a good history. They're both from the Dallas Observer.

The (W)right to fly
10/16/1997

http://www.dallasobserver.com/issues/1997-10-16/feature.html/page1.html

Enough is enough
11/19/1998

http://www.dallasobserver.com/issues/1998-11-19/news.html

And more recent news articles:

From The Dallas Morning News:

Rival may let American use gates at Love
Southwest Airlines planning proposal to offer office space at north concourse
03/29/2000

http://dallasnews.com/business/56508_love_29bus.ART.html

American Airlines unhappy with gate offer at Love
Exchange of letters shows conflict between carrier, Dallas over which concourse to use
03/31/2000

http://dallasnews.com/business/57510_lovegates_31bu.html

City standing pat as American renews request for Love Field gates
04/06/2000

http://dallasnews.com/business/60682_cartylove_06bu.html

American to cancel Love-Austin flights
Those gates redesignated for long hauls
04/20/2000

http://dallasnews.com/business/67201_love_20bus.ART.html

What's interesting about the above article is the fact that AA is using the lack of space as an excuse for cancelling the DAL-AUS service. If they really thought they would ultimately win the battle for the East Concourse, they would have just shifted the DAL-AUS flights, which used regional jets, over to the ground-level gates that Southwest originally offered and temporarily used the shared gates with CO for the new service to LAX and ORD.

Struggle over Love gates a quagmire
City politics, conflicts between airlines, threat of lawsuits make solution elusive
04/23/2000

http://dallasnews.com/business/68212_lovegates_23bu.html

Southwest defending its turf
Kelleher says it won't give up Love Field space
04/27/2000

http://dallasnews.com/business/70377_southwest_27bu.html

American begins Love construction
Airline is betting city will OK use of gates
05/11/2000

http://dallasnews.com/business/78080_aagates_11bus..html

American told to halt work on gates
Love Field construction violates lease, city says
05/17/2000

http://dallasnews.com/business/80926_AAGATES17.html

American may opt to halt Love flights
CEO says move possible if east gates denied
05/18/2000

http://dallasnews.com/business/81452_american_18bus.html

Regional rival cuts American some slack
Carriers will continue to share Love gates
05/23/2000

http://dallasnews.com/business/83922_aagates_23bus..html

Legend's flights upheld
Appeals court splits; issue awaits final test
05/26/2000

http://dallasnews.com/business/85570_legend_26bus.A.html

And from the Fort Worth Star-Telegram:

Appeals court backs Love expansion
05/25/2000

http://www.startelegram.com/news/doc/1047/1:BIZ51C/1:BIZ51C0525100.html

From The Dallas Morning News:

Legend had room to spare in 1st month
Carrier's CEO calls April statistically insignificant
06/07/2000

http://dallasnews.com/business/92086_legend_07bus.A.html

Love Field petition in the works
Five council members seek concourse vote
06/09/2000

http://dallasnews.com/business/93310_american_09bus.html

American leads Legend slightly inpassengers
06/13/2000

http://dallasnews.com/business/95400_amrlegend_13bu.html

From the Fort Worth Star-Telegram:

American seeks delay in Dallas vote
06/22/2000

http://www.startelegram.com/news/doc/1047/1:BIZ54/1:BIZ540622100.html

Atlantic Southeast Airlines to lease gate from Legend for launch of Love-Atlanta service
06/26/2000

http://www.startelegram.com/news/doc/1047/1:BIZ26/1:BIZ260626100.html

And from the Dallas Morning News:

Delta unit picks Legend Terminal
06/27/2000

http://dallasnews.com/business/102504_delta.html

Neighbors battling Love Field growth (So what else is new?   )
06/27/2000

http://dallasnews.com/metro/102518_love_27met.ART.html

Interesting that one of the council representatives for the neighborhoods around Love Field is married to an AA pilot.

From WFAA Channel 8 in Dallas:

Supreme Court refuses to Rule on Love Field Dispute

http://www.wfaa.com/wfaa/articledisplay/0,1002,11741,00.html

From The Dallas Morning News:

Legend narrows gap at Love Field
07/11/2000

http://dallasnews.com/business/109560_love_11bus.ART.html

Legend flies high in July, figures show
Startup passes American in Love passenger numbers
08/09/2000

http://dallasnews.com/business/136277_legend_09bus.A.html

The article also mentioned that Legend got the lease on it's terminal changed and can now fill all 56 seats instea of the 50 it had been limited to.

Legend's passenger numbers soar
09/14/2000

http://www.dallasnews.com/business/169507_love_14bus.ART.html

The secret's out New devotees discover Love Field
09/24/2000

http://www.dallasnews.com/business/176644_love_24bus.ART.html

The article I posted at the top is the latest and that's where things stand right now. It's better than any episode of "Dallas" or "Dynasty" and I can hardly wait for the season cliff-hanger.
You might also try going to http://www.bizjournals.com and do an advanced search for "Legend Airlines" or "Love Field" for articles in the Dallas Business Journal. There are many going back to mid-1996 which include the time period when American first leased the East Concourse at Love Field.

Hope you get an A on your paper.  

LoneStarMike

User currently offlineNotdownnlocked From United States of America, joined Sep 2000, 935 posts, RR: 1
Reply 11, posted (13 years 11 months 1 week 1 day 6 hours ago) and read 1358 times:

Excellent post!!! I just happen to live here in DFW and I also did a paper in college about Legend. They are the most helpful in giving out info. I went to their offices before they were flying and a received a packet of Legend info including court dates/outcomes, airline articles and history of the executives-easily over 200 pages worth of info. Needless to say I made an A on my report. In the 25+ years I have followed aviation in the DFW area I have learned that AA has the best lawyers and spin doctors that can be had for the money. To watch the press here is sickening as AA does nothing less than s**t vanilla ice cream and can for the most part do nothing wrong.

J.


User currently onlineLoneStarMike From United States of America, joined Jul 2000, 3826 posts, RR: 33
Reply 12, posted (13 years 11 months 1 week 1 day 5 hours ago) and read 1350 times:

Although I'm in Austin now, I, too, was born and raised in the Dallas area. Certain cities seem to have love-hate relationships with the dominant airline in their area. For Seattle it would be Alaska. For Detroit or Minneapolis, it would be Northwest. In DFW, it's definitely American.

I know that many might defend AA and say "Why should they just let Legend come in and take away some of their best paying passengers?" It pains me to say this, but I guess I would have to agee with them, simply because that's the way business is done these days.

Back in the old days (Gee, feel so old right now   ) the airlines all charged the same price and the ones who were successful were the ones who gave the best service; gave the passengers what they wanted. It seems today, though, that the main focus is on getting bigger, not necessarily better. I miss the old days. I find that I get much better service on some of the smaller airlines, simply because they have fewer employees, which makes for better communication within the ranks. With the bigger carriers, sometimes they have so many employees that it seems like the right hand doesn't know what the left hand is doing.

I don't see anything wrong with AA trying to compete with Legend, but my idea of competition and AA's idea of competition seem to be two different things. My idea of competition is when you try to offer a better product than your competitor. AA's idea of competition seems to be to try to keep the competing airline (in this case, Legend) from ever taking off. And if the competing airline does finally start service, then they go all out and try to get rid of them quickly so they can go back to being king of the hill. Why compete when you can kill?

Regarding upper management, I think the airline business has become very egotistical. When Best Buy or Lowe's decides to build a huge store next door to Home Depot, you don't see Home Depot taking them to court to prevent them from doing so. do you? Yet this behavior seems perfectly acceptable in the airline industry.

Regarding AA and their so-called "dirty tricks" all I can say is that they've always played hard-ball and that's probably why they are as successful as they are today. And it's not just AA, it's the other airlines, too, but it just seems that AA's dirty laundry gets aired more than others, in the DFW area, anyway.

Here's a parody commercial for AA that I would love to see on Saturday Night Live. Start out with a picture of all the top AA executives sitting around the table loking grim. Then have a series of either photographs or film clips of various AA attorneys passionately arguing their cases in court, shouting OBJECTION, YOUR HONOR! and banging their fists on the table. In the background would be AA's old theme song:

From the sunrise in the east
To the sunset in the west
We're American Airlines
Doing what we do best.

  LoneStarMike

User currently offlineAA@DFW From United States of America, joined Sep 2000, 397 posts, RR: 0
Reply 13, posted (13 years 11 months 1 week 15 hours ago) and read 1325 times:

I agree with you LoneStarMike --

You bring up a good analogy with the Lowe's/Home Depot example. You are right that the airline industry treats competion very differently than other industries do. But I think that is so because ALL the airlines have done it. In order to remain successful, it HAS to be cut throat. I can't see it any other way.



User currently offlineSccutler From United States of America, joined Jan 2000, 5519 posts, RR: 28
Reply 14, posted (13 years 11 months 1 week 14 hours ago) and read 1311 times:

Remember that Legend has its roots in Dalfort;

and Dalfort was the maintenance side of Braniff after the reconstitution in 1984 (and Dalfort is in the old BN HQ);

And the exquisite Legend terminal is right next door (so to speak) to the Dalfort HQ;

I think of Legend as a reincarnation (of sorts) of the old Braniff spirit- flying with style, character and courtesy.

Am I nuts? Can't help it, AA is Ft. Worth's airline; I'm in Dallas, I'll take Legend.

Good night.



...three miles from BRONS, clear for the ILS one five approach...
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