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Reuters: VX - Fuel Hedging, Fleet, Profit Outlook  
User currently offlineBigGSFO From United States of America, joined Jun 2005, 2920 posts, RR: 6
Posted (5 years 9 months 1 week 18 hours ago) and read 4696 times:

Interview with David Cush Highlights include:
-Fuel hedge opportunity
-Will remain at current fleet size for 1 1/2 years
-Still could turn profit by 2010 but may push back until 2011

Article here:http://www.reuters.com/article/businessNews/idUSTRE4AM0FR20081123

9 replies: All unread, jump to last
 
User currently offlineWedgetail737 From United States of America, joined Aug 2003, 5901 posts, RR: 6
Reply 1, posted (5 years 9 months 1 week 18 hours ago) and read 4659 times:
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Does it mean that VX will probably not open any new destinations through 2010?

User currently offlineJetBluefan1 From United States of America, joined Dec 2003, 2980 posts, RR: 14
Reply 2, posted (5 years 9 months 1 week 16 hours ago) and read 4536 times:

Very interesting information. Thanks for the link.

JetBluefan1



Most people on a.net hate JetBlue. Get used to it.
User currently offlinePanAm330 From United States of America, joined Mar 2004, 2672 posts, RR: 9
Reply 3, posted (5 years 9 months 1 week 14 hours ago) and read 4387 times:



Quoting Wedgetail737 (Reply 1):
Does it mean that VX will probably not open any new destinations through 2010?

I'm pretty sure they've got quite a bit of slack in their schedules to allow for a new destination or two. We might not see any new transcon or midcon flights, but you may see close-in destinations like PHX, SNA, PDX or even DEN added. They do have 25 aircraft, after all.


User currently offlineF9Animal From United States of America, joined Dec 2004, 5026 posts, RR: 28
Reply 4, posted (5 years 9 months 1 week 14 hours ago) and read 4387 times:



Quoting Wedgetail737 (Reply 1):
Does it mean that VX will probably not open any new destinations through 2010?

I don't think so. I am pretty sure we will see 2-3 new destinations by 2010.



I Am A Different Animal!!
User currently offlineIaddca From United States of America, joined Jul 2007, 286 posts, RR: 0
Reply 5, posted (5 years 9 months 1 week 13 hours ago) and read 4253 times:

I understand it's rough times, but when you plan to break-even three years from now, you really don't have a plan to to break-even.

I've never understood how an LCC could fill its schedule, whether with 7 destinations or 70, focusing on routes where it only offers 20-30% of the seat capacity. They should pick a destination from SFO, whether it's PDX, SNA, PHX, wherever, and determine to own it. No question they have a great in-flight product, but from a practical standpoint, it's taking too long to build a base of loyal San Franciscans, New Yorkers, and Washingtonians, etc, who'll pay a premium or choose VX consistently over PS.


User currently offlinePlanesNTrains From United States of America, joined Feb 2005, 5503 posts, RR: 29
Reply 6, posted (5 years 9 months 1 week 9 hours ago) and read 3577 times:



Quoting Iaddca (Reply 5):
I've never understood how an LCC could fill its schedule, whether with 7 destinations or 70, focusing on routes where it only offers 20-30% of the seat capacity. They should pick a destination from SFO, whether it's PDX, SNA, PHX, wherever, and determine to own it. No question they have a great in-flight product, but from a practical standpoint, it's taking too long to build a base of loyal San Franciscans, New Yorkers, and Washingtonians, etc, who'll pay a premium or choose VX consistently over PS.

I would think that, if they are trying to woo the business flyer, they will be hardpressed to do so with only a couple of destinations that they dominate. Those business flyers are likely tied to their FF programs - not switching for VX, no matter how good they are on those handful of routes.

VX needs to grow, or they'll die. IMHO.

-Dave



Next Trip: SEA-ABQ-SEA on Alaska
User currently offlineHikesWithEyes From United States of America, joined Jan 2004, 816 posts, RR: 7
Reply 7, posted (5 years 9 months 1 week 6 hours ago) and read 3067 times:



Quoting F9Animal (Reply 4):
I don't think so. I am pretty sure we will see 2-3 new destinations by 2010.

And you base that on what?



First, benzene in my Perrier, and now this!
User currently offlineIkramerica From United States of America, joined May 2005, 21511 posts, RR: 60
Reply 8, posted (5 years 9 months 1 week 4 hours ago) and read 2623 times:



Quoting Iaddca (Reply 5):
I understand it's rough times, but when you plan to break-even three years from now, you really don't have a plan to to break-even.

Which is what some domestic carriers feared was the case from the start with VX. Unlimited funds from foreign sources to keep an airline in business solely to poach high yield fliers from established carriers, especially those connecting from other Virgin brand flights.

Whether that's true or not, it's what some believe is Branson's plan.



Of all the things to worry about... the Wookie has no pants.
User currently offlineSydscott From Australia, joined Oct 2003, 2992 posts, RR: 20
Reply 9, posted (5 years 9 months 1 week 2 hours ago) and read 2377 times:



Quoting Ikramerica (Reply 8):
Unlimited funds from foreign sources to keep an airline in business solely to poach high yield fliers from established carriers, especially those connecting from other Virgin brand flights.

At which point the equation for SRB becomes "revenue derived from said premium pax for Virgin Atlantic MINUS cash cost (and opportunity cost lost from re-deploying that cash) of keeping VX in business." Not forgetting that the co-investors in VX would also have to dip into their own pockets to keep the %'s right if there was a capital injection. Given the state of the US economy if you were one of the co-investors would you put your hand in your pocket to buy more equity?


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