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WN Load Factor Drops For November  
User currently offlineCanyonBlue17 From United States of America, joined Oct 2008, 440 posts, RR: 0
Posted (5 years 7 months 3 weeks 3 days 11 hours ago) and read 2726 times:

Southwest flew 5.3 billion revenue passenger miles (RPMs) in November 2008, a 8.3 percent decrease from the 5.7 billion RPMs flown in November 2007. Available seat miles (ASMs) were essentially flat at 8.3 billion for November 2007 and November 2008. The load factor for the month was 63.2 percent, compared to 69.3 percent for the same period last year.

17 replies: All unread, jump to last
 
User currently offlineLexy From United States of America, joined Jun 2006, 2515 posts, RR: 9
Reply 1, posted (5 years 7 months 3 weeks 3 days 11 hours ago) and read 2714 times:

Just a sign of the economic times I suppose. Many of the markets they serve are really feeling the pinch of job loss and other bad news. This should come as no surprise.


Nashville, Tennessee KBNA
User currently offlineBond007 From United States of America, joined Mar 2005, 5397 posts, RR: 8
Reply 2, posted (5 years 7 months 3 weeks 3 days 11 hours ago) and read 2694 times:

Well, without any information on operating cost comparisons, those numbers really mean very little. If the costs decreased by 10%, they'd be doing very well .... I'm sure it's quite the contrary, but you get my point.


Jimbo



I'd rather be on the ground wishing I was in the air, than in the air wishing I was on the ground!
User currently offlineTN757Flyer From , joined Dec 1969, posts, RR:
Reply 3, posted (5 years 7 months 3 weeks 3 days 10 hours ago) and read 2668 times:

I think people make too much out of WN's LF's sometimes. One has to remember, they operate by far more flights per day than any other carrier. With so many flights for a passenger to choose from, it's quite likely their load factors are going to be a few percentage points lower on average than a carrier that flies fewer flights. I think the fact they (at least until the DL/NW merger) carried more domestic pax than anyone else, by a significant margin, is a better indicator, and I'm betting that's the number the folks in Dallas pay moire attention to.

User currently offlineBond007 From United States of America, joined Mar 2005, 5397 posts, RR: 8
Reply 4, posted (5 years 7 months 3 weeks 3 days 3 hours ago) and read 2488 times:



Quoting TN757Flyer (Reply 3):
I think the fact they (at least until the DL/NW merger) carried more domestic pax than anyone else, by a significant margin, is a better indicator, and I'm betting that's the number the folks in Dallas pay moire attention to.

Well, I bet the better indicator is the same one that is the most important in every other industry .... profit!

Reporting the trends of individual indicators may be useful for month to month comparisons, but in terms of how 'well the company is doing', they are useless in isolation.

Quoting TN757Flyer (Reply 3):
it's quite likely their load factors are going to be a few percentage points lower on average than a carrier that flies fewer flights.

Yes, historically, WN has been one of most financially successful US airlines ever, and also had some of the lowest load factors in the industry.

Jimbo



I'd rather be on the ground wishing I was in the air, than in the air wishing I was on the ground!
User currently offlineEnilria From Canada, joined Feb 2008, 7036 posts, RR: 13
Reply 5, posted (5 years 7 months 3 weeks 3 days 1 hour ago) and read 2424 times:



Quoting Bond007 (Reply 2):
If the costs decreased by 10%, they'd be doing very well .... I'm sure it's quite the contrary, but you get my point.

Actually, the costs increased on the "net" line because they are taking a billion charge for losses on their fuel hedge portfolio.

BTW, I love how people say "oh, that's just a one-time item, it doesn't count", yet when Southwest was using fuel hedges to make money it was never said despite all the quarters they lost money absent the fuel hedges.


User currently offlineNkops From United States of America, joined Jun 2005, 2660 posts, RR: 6
Reply 6, posted (5 years 7 months 3 weeks 3 days 1 hour ago) and read 2413 times:



Quoting TN757Flyer (Reply 3):
I think people make too much out of WN's LF's sometimes.

Not just WN's... I think there is too much emphasis systemwide... which would you rather have .. a 50% LF with Y fares, or 100% with V fares....



I have no association with Spirit Airlines
User currently offlineEnilria From Canada, joined Feb 2008, 7036 posts, RR: 13
Reply 7, posted (5 years 7 months 3 weeks 3 days 1 hour ago) and read 2390 times:



Quoting Nkops (Reply 6):
Not just WN's... I think there is too much emphasis systemwide... which would you rather have .. a 50% LF with Y fares, or 100% with V fares....

True, but average fares don't usually change as dramatically from one month to the next as loads do. AND year-over-year changes in fare are even smaller than month-over-month changes. I don't doubt their fare is up 5-6% YOY, but there is no way they made up the LF decline. CO reports RASM and they had a RASM increase for November of 1-2% on a much better LF situation. That's a sign that average fares were pretty flat for the industry in November.


User currently offlineMOBflyer From United States of America, joined Sep 2007, 1209 posts, RR: 4
Reply 8, posted (5 years 7 months 3 weeks 3 days ago) and read 2352 times:



Quoting Enilria (Reply 7):
True, but average fares don't usually change as dramatically from one month to the next as loads do. AND year-over-year changes in fare are even smaller than month-over-month changes. I don't doubt their fare is up 5-6% YOY, but there is no way they made up the LF decline. CO reports RASM and they had a RASM increase for November of 1-2% on a much better LF situation. That's a sign that average fares were pretty flat for the industry in November.

I wouldn't be surprised if their average yield almost increased the requisite 9.5% to offset the drop in LF. Over the past few quarters they have been pushing both fare increases and reducing their long haul ASMs, both of which bode well for a substantial increase in yield. I don't know that they got QUITE that much of an increase, but they can't be far off.


User currently offlineEnilria From Canada, joined Feb 2008, 7036 posts, RR: 13
Reply 9, posted (5 years 7 months 3 weeks 3 days ago) and read 2341 times:



Quoting MOBflyer (Reply 8):
I wouldn't be surprised if their average yield almost increased the requisite 9.5% to offset the drop in LF. Over the past few quarters they have been pushing both fare increases and reducing their long haul ASMs, both of which bode well for a substantial increase in yield. I don't know that they got QUITE that much of an increase, but they can't be far off.

You might be right, but I tend to think that all the capacity they have stuffed into DEN in such a short time is creating a drag on their RASM.


User currently offlineN471WN From United States of America, joined Dec 2003, 1516 posts, RR: 2
Reply 10, posted (5 years 7 months 3 weeks 2 days 21 hours ago) and read 2228 times:
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I too am wondering why more folks have not made the change to SWA as a result of the "in your face" fees others charge. I love SWA and their great advertisements on "no fees" but I fear that people will do anything to continue to get miles on the AA and UAL's of the world including putting up with lousy service. SWA is well positoned to have the planes and capacity when the economy improves and I hope that if they park planes that they can bring them back on line quickly.

User currently offlineTugger From United States of America, joined Apr 2006, 5419 posts, RR: 8
Reply 11, posted (5 years 7 months 3 weeks 2 days 21 hours ago) and read 2184 times:



Quoting Nkops (Reply 6):
Not just WN's... I think there is too much emphasis systemwide... which would you rather have .. a 50% LF with Y fares, or 100% with V fares....

Is there anyway to find out what fare categories make up the, do airlines breakout the information? I know many do seem to interpret WN's loads as being low but I suspect that Southwest has a much lower quantity of "free fliers" than other airlines that have very extensive loyalty programs.

Quoting N471WN (Reply 10):
but I fear that people will do anything to continue to get miles on the AA and UAL's of the world

This is what airlines like UA, AA, and DL count on. It is THE reason why they have the loyalty programs in the first place.

And many fliers (and many who post here) are fanatic about getting their miles and equally important their "status"!

Tugg



I don’t know that I am unafraid to be myself, but it is hard to be somebody else. -W. Shatner
User currently offlineTN757Flyer From , joined Dec 1969, posts, RR:
Reply 12, posted (5 years 7 months 3 weeks 2 days ago) and read 1995 times:



Quoting Tugger (Reply 11):
This is what airlines like UA, AA, and DL count on. It is THE reason why they have the loyalty programs in the first place.

Let's not forget WN has it's own FF program. Maybe you can't get to Australia or Europe on it, but as often as I fly them those 2-3 freebies a year are nice to have. They make it much easier for people to obtain free tickets, and its MUCH less hassle obtaining your reward. I've been trying to cash in my AAdvantage miles and have yet to find a open flight on the dates I can use them.


User currently offlinePHLBOS From United States of America, joined Mar 2004, 7510 posts, RR: 24
Reply 13, posted (5 years 7 months 3 weeks 1 day 19 hours ago) and read 1902 times:



Quoting TN757Flyer (Reply 12):
I've been trying to cash in my AAdvantage miles and have yet to find a open flight on the dates I can use them.

I had a similar problem when I wanted to cash in my NW WorldPerks for a r/t PHL-PDX itinerary this past summer.

Quoting N471WN (Reply 10):
I too am wondering why more folks have not made the change to SWA as a result of the "in your face" fees others charge. I love SWA and their great advertisements on "no fees" but I fear that people will do anything to continue to get miles on the AA and UAL's of the world including putting up with lousy service.

A couple things to consider regarding the traveling public's reaction to fees... particularly the checked bag fees:

1. If a traveler has enough miles in their 'bank' to achieve a certain status; they're exempt from at least the baggage fees.

2. I recently read in the local paper the other day that many travelers have fought back by just doing carry-on on their preferred carrier... or by not flying at all. Another thing to keep in mind, WN doesn't fly everywhere in the country; so not everyone (ATL folks, for example) can choose them.

Personally, and I've stated this before in past-related threads, the true test of the baggage fees will come during this upcoming Christmas traveling season where a greater portion of less-frequent leisure travelers will be boarding flights for the vacation destinations. This is the first Christmas that a first bag fee has been imposed on many airlines (AS, B6, VX & WN are now the only ones that don't charge for the first checked bag). A $15 fee for the first checked bag per person each-way for a family of four translates to an additional $120 to the overall airfare bill; that's pretty significant.

I, for one, would be very curious to see/read the results come on the overall holiday travel season come this January/February.



"TransEastern! You'll feel like you've never left the ground because we treat you like dirt!" SNL Parady ad circa 1981
User currently offlineTN757Flyer From , joined Dec 1969, posts, RR:
Reply 14, posted (5 years 7 months 3 weeks 1 day 19 hours ago) and read 1892 times:



Quoting PHLBOS (Reply 13):
I, for one, would be very curious to see/read the results come on the overall holiday travel season come this January/February.

I think we've already been hearing and seeing signs that holiday travel this year is not going to equate that of recent years. As others have mentioned, higher fares and fees have priced a lot of those "once a year" fliers out of the market, and the economy in general is probably going to keep a lot of people home this year. Others may drive shorter trips now that gas has dropped back down. I flew into BNA the Sunday after Thanksgiving, and it was eerily quiet compared to past years when I've flown on the same day. I'm guessing airlines are hoping things pick up by summer '09 lest the entire year will be really ugly from the financial side.


User currently onlineCubsrule From United States of America, joined May 2004, 22721 posts, RR: 20
Reply 15, posted (5 years 7 months 3 weeks 1 day 19 hours ago) and read 1883 times:



Quoting Tugger (Reply 11):
I know many do seem to interpret WN's loads as being low but I suspect that Southwest has a much lower quantity of "free fliers" than other airlines that have very extensive loyalty programs.

That may be true. It's also true that WN sells a much higher percentage of full-fare tickets than do most of its competitors.



I can't decide whether I miss the tulip or the bowling shoe more
User currently offlineTango-Bravo From United States of America, joined Jun 2001, 3802 posts, RR: 29
Reply 16, posted (5 years 7 months 3 weeks 1 day 19 hours ago) and read 1883 times:



Quoting N471WN (Reply 10):
people will do anything to continue to get miles on the AA and UAL's of the world including putting up with lousy service.[/quote

[quote=Tugger,reply=11]This is what airlines like UA, AA, and DL count on. It is THE reason why they have the loyalty programs in the first place.

And many fliers (and many who post here) are fanatic about getting their miles and equally important their "status"!

And when they complain about and point the proverbial finger of blame for "poor service" on the likes of AA, UA and other legacies, they appropriately have 3 fingers of blame pointing back at themselves.

Yes, the legacies are only all too aware that many if not most in the legions of their "most loyal" customers are, in reality, metaphorical drug addicts who will keep coming back again and again, ad infitum regardless of the level to which service drops and how much they complain about same, even to the point of making empty threats to fly with another carrier... for as long as the airlines to whose metaphorical drugs they are addicted keep their drug cravings satisfied.

When all the smoke (and mirrors) of FF games is cleared away, the "loyalty" programs of the legacies are focused on buying customer "loyalty" to the virtual exclusion of earning genuine loyalty with quality service. And since countless numbers of their customers are eager to fall for it...why change?


User currently offlineStapleton From United States of America, joined Nov 2006, 280 posts, RR: 2
Reply 17, posted (5 years 7 months 3 weeks 1 day 17 hours ago) and read 1805 times:



Quoting N471WN (Reply 10):
I too am wondering why more folks have not made the change to SWA as a result of the "in your face" fees others charge.

One of the reasons why many people do not change is the extremely limited domestic network that Southwest has. They have some very big holes which until filled will impact their ability to have entice at least some passengers to switch. The holes that I am referring to are the lack of an international network, the lack of a presence in many major markets (Atlanta, Charlotte, Cincinnati, Memphis, Milwaukee, etc. but they are making moves to rectify this by entering markets likes SFO, DEN, IAD, LGA) and of course the fact that they do not really serve small markets anywhere in the country. If you are a business person who does business in cities like London or Atlanta or Sioux Falls then Southwest is at a disadvantage. Great airline but if they don't fly to where you need to fly, then it isn't all that different than asking why people don't switch to Singapore Airlines if they live or need to travel to Little Rock.

Southwest obviously knows this and is working on the problem but they are limited to the resources they have. I am sure one of the reasons they are in Denver now is because it is a great market that can connect east and west more efficiently than Chicago or Phoenix can, especially if you are trying to get from Omaha to Seattle or markets like that.


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