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STL Made Strategic Mistake With Jblu  
User currently offlineLowecur From United States of America, joined Jan 2005, 585 posts, RR: 0
Posted (7 years 9 months 2 weeks 5 days 22 hours ago) and read 10276 times:

Today STL is kicking itself. With CVG and SLC as possible hub sites for the 190, STL's value just took a hit. They played hardball with JBLU, and it will most likely cost them. I'm sure they will request immediate discussions to see if they can do a deal in the nearterm. Any hesitation will certainly cost them. I believe JBLU will put them on the backburner and let this thing play out. The only chance they have is to put up an offer too good to turn down.

With the 1st salvo fired in the merger wars, consolidation is now on the table. With this proposed merger you can expect at least one other suitor for DL. No one is going to let Doug walk off with this deal for $8B. The next suitor will also need to have the same pedigree as Doug Parker to get any Wall St. Bankers backing. The eventual winner will be hand picked by DL's creditors.

Whoever they are, the selection for a midwest hub just got more interesting.

51 replies: All unread, showing first 25:
 
User currently offlineMariner From New Zealand, joined Nov 2001, 25155 posts, RR: 85
Reply 1, posted (7 years 9 months 2 weeks 5 days 22 hours ago) and read 10269 times:
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Quoting Lowecur (Thread starter):
They played hardball with JBLU, and it will most likely cost them.

I'm not clear what STL did that might have cost 'em?

mariner



aeternum nauta
User currently offlineLowecur From United States of America, joined Jan 2005, 585 posts, RR: 0
Reply 2, posted (7 years 9 months 2 weeks 5 days 22 hours ago) and read 10223 times:

Quoting Mariner (Reply 1):
I'm not clear what STL did that might have cost 'em?

In speaking with a JBLU pilot, he said a station mgr was hired but then let go when the deal fell through.

My speculation is that STL wouldn't amend the contract to let JBLU off the hook if either AMR or SWA decided to pull up stakes if it became unprofitable. I believe remaining carriers would be responsible to pay off the airport bonds for existing improvements, and this was the reason JBLU backed off the deal. I think they want a contract with a cap where they won't get stuck for the difference.


User currently offlineLambertMan From United States of America, joined Aug 2003, 2074 posts, RR: 36
Reply 3, posted (7 years 9 months 2 weeks 5 days 22 hours ago) and read 10184 times:

Quoting Mariner (Reply 1):
I'm not clear what STL did that might have cost 'em?

mariner

There's speculation (with grounds) that St. Louis sweet talked itself out of a deal with JetBlue for a midwest E90 focus city.

About 3 or 4 months ago a B6 employee made a post suggesting that CMH, SRQ and a STL focus city would be announced. CMH and SRQ did indeed come true, but STL obviously did not. The day before the announcement he said St. Louis talked its way out of it, if I remember right. He did say that good things come to those who wait, whoever and whatever that is referring to I don't know.

With that said, I wasn't completely sold on the idea of B6 having a focus city here anyway. The St. Louis market, in my opinion, has reached saturation. It shows as well, there hasn't been hardly anything added/subtracted in the past year by carrier. American and Southwest, the two carriers that would have interest in adding, appear to have reached a happy medium.


User currently offlineDeltAirlines From United States of America, joined May 1999, 8897 posts, RR: 12
Reply 4, posted (7 years 9 months 2 weeks 5 days 21 hours ago) and read 10107 times:

Quoting Lowecur (Thread starter):
The eventual winner will be hand picked by DL's creditors.

Part of the problem is CVG and SLC might not be available at all. I strongly doubt the DOJ will even consider allowing US and DL to merge, and I think DL's management will try to talk creditors into going with the stand-alone course. Just because US wants DL doesn't mean DL wants US, nor is it necessarily going to happen.


User currently offlineMariner From New Zealand, joined Nov 2001, 25155 posts, RR: 85
Reply 5, posted (7 years 9 months 2 weeks 5 days 21 hours ago) and read 10104 times:
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Quoting LambertMan (Reply 3):
With that said, I wasn't completely sold on the idea of B6 having a focus city here anyway.

It puzzled me, too. If nothing else, JetBlue has gone (slightly) out of its way to avoid direct competition with Southwest.

Then again, I don't know how vital it is for Jetblue to have a midwest hub at all. I guess it depends on how they perceive their long-term future.

Quoting LambertMan (Reply 3):
The St. Louis market, in my opinion, has reached saturation.

That may be true.

It may be possible to change that, but it might require a determination by an airline to make it a crossroads, as TWA did.

mariner



aeternum nauta
User currently offlineLowecur From United States of America, joined Jan 2005, 585 posts, RR: 0
Reply 6, posted (7 years 9 months 2 weeks 5 days 21 hours ago) and read 10024 times:

Quoting DeltAirlines (Reply 4):
Part of the problem is CVG and SLC might not be available at all. I strongly doubt the DOJ will even consider allowing US and DL to merge, and I think DL's management will try to talk creditors into going with the stand-alone course. Just because US wants DL doesn't mean DL wants US, nor is it necessarily going to happen.

DL doesn't have any say in the matter, this is an offer made directly to the creditors. You actually believe the creditors will go along with Grinstein or his protege' in favor of getting Doug Parker Plus 25% premium value? As for the DOJ? Times have changed since the last UAL/USAirways failed merger attempt. The FAA needs to reduce congestion with a reduction of 50 seat RJs. They will be more than happy to give the DOJ a recommendation provided Doug Parker has submitted a viable plan. My guess is more than 10% of the domestic capacity will end up on the cutting room floor once the final negotiations are in order. I also look for another offer on the table for DL in the coming weeks or months.

[Edited 2006-11-15 22:14:36]

User currently offlineStirling From Italy, joined Jun 2004, 3943 posts, RR: 21
Reply 7, posted (7 years 9 months 2 weeks 5 days 20 hours ago) and read 9898 times:

If jetBlue needs a mid-continent hub.....we'd love to see them here in Colorado Springs! They wouldn't be stepping on anyone's toes, except those of the ghost of Western Pacific....


Delete this User
User currently offlineOzarkD9S From United States of America, joined Oct 2001, 5073 posts, RR: 21
Reply 8, posted (7 years 9 months 2 weeks 5 days 20 hours ago) and read 9895 times:

The big question mark AAs AAlways is AA and would they put up a fight for STL if an LCC came in with a serious plan to hub there?

I have my doubts as whether AA would stand thier ground here (STL). All AA might end up with is DFW, MIA, ORD, LGA, DCA and maybe LAX at the end of the day. Most of the other AA flights are AAConnection anyway.



Next Up: STL-LGA-RIC-ATL-STL
User currently offlineMrSTL From United States of America, joined Sep 2005, 468 posts, RR: 1
Reply 9, posted (7 years 9 months 2 weeks 5 days 19 hours ago) and read 9836 times:

Would love to see B6 here, I'll wait to see where the chips land.

On an AA STL sidenote-- AA adds a 10th RT to DFW in January and goes to five RT's/day to DAL -- 3xMD80 and 2XERJ.

STL has not reached saturation as traffic, particularly O&D, continues to grow.

IIRC Neeleman alluded to possibly holding off on a midwest focus city on the last earnings conference call-- instead choosing to focus on current focus cities such as Boston.


User currently offlineMariner From New Zealand, joined Nov 2001, 25155 posts, RR: 85
Reply 10, posted (7 years 9 months 2 weeks 5 days 19 hours ago) and read 9836 times:
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Quoting Lowecur (Reply 6):
You actually believe the creditors will go along with Grinstein or his protege' in favor of getting Doug Parker Plus 25% premium value? As for the DOJ? Times have changed since the last UAL/USAirways failed merger attempt.

I am sure you are right, but I wold not underestimate how hard Mr. Grinstein - who sitll has powerful allies - will fight.

Mr. Parker may have staked his claim as the Young Lion taking over the pride, but the Old Lion isn't going to go quietly.

It will be interesting to watch.  Smile

mariner



aeternum nauta
User currently offlineOMA2FAI2SAV From , joined Dec 1969, posts, RR:
Reply 11, posted (7 years 9 months 2 weeks 5 days 19 hours ago) and read 9744 times:

No, B6 decided to forget about STL as a focus city, and move the focus to PIA as a focus city. LOL. In all seriousness, I would like to see a focus city in STL. That might mean B6 will open up OMA with the E190 from STL.

User currently offlineJetBlueGuy2006 From United States of America, joined Jan 2006, 1656 posts, RR: 1
Reply 12, posted (7 years 9 months 2 weeks 5 days 18 hours ago) and read 9700 times:

I hope STL tries to do something to mend the fences. They could have an E-190 focus city to Midwestern destinations as well as having a couple 320's to NYC to connect nationwide.

I would love to see them make that commitment so we can finally get B6 in Michigan!

edit: spelling



Home Airport: Capital Region International Airport (KLAN)
User currently offlineSupa7E7 From , joined Dec 1969, posts, RR:
Reply 13, posted (7 years 9 months 2 weeks 5 days 18 hours ago) and read 9671 times:

Even if US and DL merge, they would still keep 100 daily flights at SLC and CVG. Just as defensive, profitable, O&D installations.

Sure, shrink, but why pull out profitable flying? They wouldn't.


User currently offlineLowecur From United States of America, joined Jan 2005, 585 posts, RR: 0
Reply 14, posted (7 years 9 months 2 weeks 5 days 17 hours ago) and read 9607 times:

Quoting Mariner (Reply 10):
am sure you are right, but I wold not underestimate how hard Mr. Grinstein - who sitll has powerful allies - will fight.

Mr. Parker may have staked his claim as the Young Lion taking over the pride, but the Old Lion isn't going to go quietly.

It will be interesting to watch.

I personally think Grinstein has known about this for a longtime. He is a Wall St insider who has many friends that I'm sure tipped him months ago. In fact it wouldn't surprise me if he approved of the move, but chose to keep his mouth shut to keep the BK process going smoothly. Nothing is worse than bringing this type of thing up to the troops while trying to emerge from BK.


User currently offlineSTLGph From United States of America, joined Oct 2004, 9345 posts, RR: 26
Reply 15, posted (7 years 9 months 2 weeks 5 days 15 hours ago) and read 9499 times:

St. Louis isn't interested in a JetBlue hub. St. Louis isn't even really interested in service by JetBlue.

Why?

* American Airlines

-- despite cuts in service reductions, AA still remains a big player and employer here in the city.

-- Trans States is a St. Louis based regional airline hiring and employing a great deal of St. Louis residents. Trans States is still very dependant upon AA for its continued existance.

-- there is continued faith that AA will continue to add flights to the schedule and resume services in the future as the needs warrant


* Southwest Airlines

-- for the help in breaking down the Wright Amendment, Southwest was promised more traffic coming through STL and an increase of flights. of course any of this has yet to happen, but they are still believing that Southwest will come through with their promise of the bargain.



if assumptions could fly, airliners.net would be the world's busiest airport
User currently offlinePropilotJW From United States of America, joined Mar 2000, 589 posts, RR: 7
Reply 16, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9492 times:

Quoting Lowecur (Reply 2):
In speaking with a JBLU pilot, he said a station mgr was hired but then let go when the deal fell through.

That pilot was wrong.


User currently offlineAtrude777 From United States of America, joined Aug 2003, 5692 posts, RR: 52
Reply 17, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9491 times:

Quoting STLGph (Reply 15):
* Southwest Airlines

-- for the help in breaking down the Wright Amendment, Southwest was promised more traffic coming through STL and an increase of flights. of course any of this has yet to happen, but they are still believing that Southwest will come through with their promise of the bargain.

There HAS been an increase of more traffic in regards to passengers, SWA is sending alot of folks through STL for connecting which brings in more money.

As for Traffic, right now SWA is maxxed out at STL. they are only using 7 gates, and are maxed out at 70 flights a day. SWA cannot add another flight unless they add another jetbridge which we are hoping they will do soon.

Alex



Good things come to those who wait, better things come to those who go AFTER it!
User currently offlineCIDflyer From United States of America, joined Apr 2005, 2285 posts, RR: 3
Reply 18, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9491 times:

Quoting Atrude777 (Reply 17):
There HAS been an increase of more traffic in regards to passengers, SWA is sending alot of folks through STL for connecting which brings in more money.

does anyone know if AA has seen an increase in DAL passengers routing thru STL as well?


User currently offlineMariner From New Zealand, joined Nov 2001, 25155 posts, RR: 85
Reply 19, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9491 times:
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Quoting Lowecur (Reply 14):
I personally think Grinstein has known about this for a longtime.

Sure. Provably, he's known about it since Mr. Parker's original phone call last spring.

And if he had answered Mr. Parker's October letter, he might be in a stronger position now, to at least have some control over the events. By ignoring it, he has allowed Mr. Parker to go straight to the creditors.

But I fear we are hijacking this thread. Sorry, everyone.

 Smile

mariner



aeternum nauta
User currently offlineStl1326 From United States of America, joined Jun 2005, 496 posts, RR: 0
Reply 20, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9491 times:

Quoting Atrude777 (Reply 17):
SWA cannot add another flight unless they add another jetbridge which we are hoping they will do soon.

Yes, they can. The only gate in Southwest's Terminal that doesn't have a jetbridge is gate E2. They may be only using 7 gates but they still have 4 gates unused...


User currently offlineBHMNONREV From Australia, joined Aug 2003, 1373 posts, RR: 4
Reply 21, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9491 times:

Quoting STLGph (Reply 15):
St. Louis isn't interested in a JetBlue hub. St. Louis isn't even really interested in service by JetBlue.

Why?

* American Airlines

-- despite cuts in service reductions, AA still remains a big player and employer here in the city.

-- Trans States is a St. Louis based regional airline hiring and employing a great deal of St. Louis residents. Trans States is still very dependant upon AA for its continued existance.

-- there is continued faith that AA will continue to add flights to the schedule and resume services in the future as the needs warrant


* Southwest Airlines

-- for the help in breaking down the Wright Amendment, Southwest was promised more traffic coming through STL and an increase of flights. of course any of this has yet to happen, but they are still believing that Southwest will come through with their promise of the bargain.

I think these are very valid reasons, and I think right now Dolliole would rather have the sure thing with the status quo (AA/WN), than risk alienating them to accommodate B6 by rolling out the red carpet.

However, I'm sure that if JetBlue wanted to start up shop in STL he would welcome them with several flights a day to JFK/BOS/LGB/OAK. But a sweetheart deal leaving them off the hook if they pull out? Sorry Neeleman, take it elsewhere.

In an earlier post LambertMan stated that the STL market was saturated, however IMHO I would like to think that service to STL right now is right-sized, rather than saturated. However, with some competitive growth I believe the market could support another 10-15 daily flights. Sounds just about right for a small E-190 operation if you ask me, and Concourse B is just sitting there, waiting to be taken...  stirthepot 


User currently offlineAtrude777 From United States of America, joined Aug 2003, 5692 posts, RR: 52
Reply 22, posted (7 years 9 months 2 weeks 5 days 14 hours ago) and read 9490 times:

Quoting Stl1326 (Reply 20):
Yes, they can. The only gate in Southwest's Terminal that doesn't have a jetbridge is gate E2. They may be only using 7 gates but they still have 4 gates unused...

E-2, as well as E-22, 24 do not have jetbridges or blocked in to where SWA cannot access a gate.

E-4 and E-6 got their gates from E-22 and E-24.

E-20 is the only gate not being used and I think it was blocked in when I saw it last time.

Alex



Good things come to those who wait, better things come to those who go AFTER it!
User currently offlineSTLGph From United States of America, joined Oct 2004, 9345 posts, RR: 26
Reply 23, posted (7 years 9 months 2 weeks 5 days 13 hours ago) and read 9490 times:

Quoting BHMNONREV (Reply 21):

I think Concourse B is on its way out the door...eventually. If the airport gets serious about terminal redevelopment, tearing B down first and starting here would be the ideal plan.



if assumptions could fly, airliners.net would be the world's busiest airport
User currently onlineWesternA318 From United States of America, joined Oct 2004, 5657 posts, RR: 24
Reply 24, posted (7 years 9 months 2 weeks 5 days 13 hours ago) and read 9490 times:

Quoting STLGph (Reply 15):
St. Louis isn't interested in a JetBlue hub. St. Louis isn't even really interested in service by JetBlue.



Quoting BHMNONREV (Reply 21):
But a sweetheart deal leaving them off the hook if they pull out? Sorry Neeleman, take it elsewhere.

Amen to that!! Finally an airport that doesnt take the BS B6 spits out...



Next blog will be up on 8/30/14 around 6PM Mountain Time...check it out at fl310travel.blogspot.com!
25 Post contains links and images BHMNONREV : So what has Southwest done with all of the jetbridges? This Google Earth photo shows everyone of the 12 gates intact, even the one at E-2. Now I unde
26 WesternA318 : Whose 727-200 is that?
27 Atrude777 : As far as I can recall, E-2 never had a jetbridge, it is completely shut and stuff is blocking it minus the picture showing it of course. E-4 was mis
28 BHMNONREV : As much as I would like to see A and B torn down to start some terminal redevelopment, B will currently be the key in getting any new service started
29 Atrude777 : Should be Champion Air. Alex
30 LambertMan : E-2 had a jetbridge for about the first 5 or 6 years of east terminal use. We actually dropped my dad off at E-2 when he went to Florida back in the
31 STLGph : B Concourse is too awkward in design and shape and addition of jet bridges would block needed tarmac space. Ideally a future St. Louis Airport termin
32 Post contains images BHMNONREV : Amazing what getting the Wright perimeter extended can do for that "dog housitis"...
33 STLGph : Wow, two new flights per day. I'm almost beside myself.
34 Atrude777 : You sure really have a thorn against SWA, you down every statement SWA makes about STL, claims its all "smokescreen" and such. It is getting very tir
35 BDL2STL2PVG : At the end of TW's days, there were still 3 jetbridges on the East side of Concourse B. IIRC, well prior to that there were approximately 9 jetbridge
36 Post contains links and images BHMNONREV : I agree, and being here in the desert I have a lot of idle time and pardon my very crude photoshop skills I came up with something I remember seeing
37 STLGph : read the Southwest schedule. unless people enjoy 2 or 3 hour layovers they aren't doing much connecting. Dallas "gains" the two flights while Houston
38 Atrude777 : I did the math, using the May schedule they released we have 71 daily flights, to 22 cities non stop. we currently have 70, so really we still have g
39 MrSTL : We were at 64 flights a year ago so we have increased 10% in the last year-- Not bad at all. Granted I don't think it has been a windfall of new flig
40 Boeing Nut : This is not even a thought currently. The ones that were on E2 and E4 were taken off the airfield to another airport SWA serves. Northeast somewhere
41 MrSTL : Frontier/Airtran combo focus city in STL is an intriguing idea, likely, well who knows. They have a new frequent flier agreement. How's the customs r
42 STLGph : Yes it is. I'm talking about the west side. Yes really. Southwest, American, USA 3000, Frontier, Champion want the path to the west side of the field
43 Boeing Nut : So is building a new terminal on the west side of the field, but as of right now, it ain't gonna happen. Same with B concourse demolition. B is extre
44 BDL2STL2PVG : The fact is that if another carrier wanted to establish a focus city in STL then Lambert, in its current form, could offer the option of a Y shaped B
45 FlyBoy84 : WOW...BMHNONREV! Apparently we're on the same wavelength since that is the route that I thought STL should take for some kind of redevelopment! It wou
46 Post contains images STLGph : here, have some. moot. and looked like they were making good use of it two weeks ago when I was at the airport.
47 Boeing Nut : Well sure it's getting used, but mainly for push backs. Using Charlie for full length or not so full length is what is rare. Sorry if I came across a
48 J32driver : Watching this thread from the viewpoint of someone who operated aircraft out of STL (B concourse specifically) for a couple of years, its pretty easy
49 Post contains images BHMNONREV : Greetings my friend! Have not seen you around here very much recently.. I was not trying to hijack the thread but when the Lambert expansion/renovati
50 STLGph : except for the part where some of HK's company & I played a few rounds this summer. and SK is quite the little shopper at Plaza Frontenac. should i d
51 TransWorldSTL : eww. Dirtiest Sak's and Neiman in the world.
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