Jgrant From United States of America, joined Apr 2008, 8 posts, RR: 0 Posted (5 years 9 months 2 weeks 6 days 18 hours ago) and read 2156 times:
I’ve read occasionally here that YX has provided NW with some level of protection from other LCCs on it’s midwest region turf. I don’t really understand how it benefits NW for the investment value that they put in to keep FL out of their backyard. And yes I do realize that they have removed that investment value from their books. However, I read that DL has entered into a “muti-faceted alliance aggrement with YX, sort of reconfirming the NW code share and frequent flyer agreement (and expanding?). I was hoping to hear what type of real economic benefit that NW and now DL should expect?
In addition, it occurs to me that why would they not expand to include other LCCs in other hub cities? For example, F9 in Denver, where UA has a large hub. The Frontier frequent flyer who uses UA to a destination that F9 doesn’t fly. Seems like a low risk way for a DL to pick-up those frequent travelers that would usually pick UA as second choice to the destination that only UA or DL could accommodate.
Taking it a step further… So Republic has provided financing to both YX and F9. Could someone like Republic control both carriers financially, combine operations (I’m not saying merger) and enter into an agreement with a DL. Maybe also operate the bulk of the DL CVG hub for DL.
Hoping this would generate some discussion on how these alliances benefit the carriers involved, some discussion about why we don’t see more of the larger legacy carriers team up with the LCCs, and speculation about which carriers would benefit with a Legacy/LCC alliance.
FlyPNS1 From United States of America, joined Nov 1999, 6733 posts, RR: 24
Reply 1, posted (5 years 9 months 2 weeks 6 days 18 hours ago) and read 2115 times:
Quoting Jgrant (Thread starter): Hoping this would generate some discussion on how these alliances benefit the carriers involved, some discussion about why we don’t see more of the larger legacy carriers team up with the LCCs, and speculation about which carriers would benefit with a Legacy/LCC alliance.
YX isn't an LCC. Their costs and overall business model are much more like the legacies. This is one reason that carriers like NW and now DL are willing to partner with YX and not LCC's like B6, FL or F9. Those LCC's can dramatically reduce fares which the legacies obviously don't like, but YX historically hasn't pushed yields down.