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What Is US Air's *R*E*A*L* Problem?  
User currently offlineWatewate From Canada, joined Nov 2000, 2284 posts, RR: 1
Posted (13 years 4 days 9 hours ago) and read 2521 times:

We all know US Air is not in the best of shape, but what is the real problem behind its dismal state? Could a competent group of management (i.e. Bethund and friends) have made a difference. The more I hear Wolfe's pleas to have the merger approved, the more it sounds like he wants to cash in (with his multi-million dollar option) at the expense of US's employees.
Let's face it, Wolfe has done nothing good for US and its employees. He missed the alliance frenzy, was late in modernizing its fleet, made the smart decision to go head to head with WN at BWI, missed the RJ boat...should I go on?
The way I see it, Wolfe has done nothing but harm at US Air. With large O&D airport in PHL and nicely located hub airports in PIT and CLT, US shouldn't be struggling as badly if Wolfe made the right calls even once in a blue-moon.
And why is it that Wolfe hasn't managed to bring down the costs at US? I always hear of extraordinarly high costs at US, but I can't see how this will lead to US's demise as Wolfe makes it out to be. Sure, there are added costs associated with operating large, delay prone, cogested airports in the East coast, but I don't hear CO and DL complaining.
Is it too late for US to turn around and see the black? With RJ expansion, membership into an alliance, increased west-coast ops and realigning the roles of its three main hubs, I think US can survive on its own. And yes, Wolfe has got to go.

Q. What is US's problem?
A. Wolfe

45 replies: All unread, showing first 25:
 
User currently offlineAirwaysdc9 From United States of America, joined May 1999, 204 posts, RR: 3
Reply 1, posted (13 years 4 days 9 hours ago) and read 2332 times:

His name is Stephen Wolf (no "e") and he's not the problem, he's the solution.

There have been many threads on this message board regarding the reasons for US Airways' high cost structure.


User currently offlineUPS Pilot From United States of America, joined May 1999, 871 posts, RR: 3
Reply 2, posted (13 years 4 days 8 hours ago) and read 2320 times:

That is a tough call. I don't feel Wolf is the problem. Talking to U.S. Airways pilots some want the merger to go thru and others don't. I feel that it won't even though I do have U.S.Airways stock and the $60 per share United was offering would be nice.

I do feel though the growing pains are tough. The new fleet purchases were needed. The additional European routes are good. The problem is the lack of a western United States network for U.S. Airways along with no flights to Asia. They need a stronger global presence to survive. The merger would work well to fit this need but then you have the typical bickering about senority, and other human resource issues involved with mergers. Morale on both sides would probably be affected in a merger. I feel United now won't pay the $60. per share offering now.

As far as U.S. Airways missing the boat on alliances well that may have been a good thing since these alliances are starting to fall by the wayside. The regional jet thing is wrong. U.S. Airways Express contractors do have RJ's. I have flown on many of them out of Philly and Pittsburgh as well as CLT and BWI.

Once fuel prices start to fall and the economy starts to perk back up U.S. Airways should look into some L.R. aircraft and possibly expand out west and into Asia. The JFK- NRT route would be nice or a PHL- LAX- CLK route.
JMO  Smile


User currently offlineRoastedNutz From United States of America, joined Feb 2001, 220 posts, RR: 0
Reply 3, posted (13 years 4 days 7 hours ago) and read 2273 times:

If US has such high costs, maybe they should start scaling back, especially now that the economy is supposedly going down the crapper at any minute.

User currently offlineRyeFly From United States of America, joined Jun 2000, 1391 posts, RR: 0
Reply 4, posted (13 years 4 days 7 hours ago) and read 2261 times:

I'm not sure if Wolf is the big problem either. US Air like many other airlines grew very fast by buying other airlines out. Usually these growing pains can have a negative effect over time with the airline and it eventually goes bankrupt. However once Wolf joined on the airline took on a different image. Plans to modernize its fleet, purchasing the shuttle and becoming a heavy contender on the trans-altantic market has helped US Airways in achieving its goal as the carrier of choice. With only 1/4 of the Airbus fleet online and a portion of its terminals renovated it's a slow process, especially for an airline that like fast changes. By the time they get everything complete it will still lack behind its competitors global status. So the quick fix is to merge with one. If that doesn't work then they will go with plan B. Build up further over the Atlantic and stengthen it's grip on the east coast and continue to build up its transcontinental service. This is already begining to happen with or without the merger. CLT for example is begining a $1billion expansion already approved which will more then double the ammount of gates to around 130 or so. PHL is also doing major expansions. Its too early to plan going over the Pacific right now unless they were to buy out a smaller carrier like America West or Alaska so they could feed more domestic traffic west.

I aggree some things should have done earlier but its begining to get organized. It just takes time which Wolf is running out of. I expect he will retire even if the merger is a no go.


User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4467 posts, RR: 34
Reply 5, posted (13 years 4 days 7 hours ago) and read 2259 times:

As AirwaysDC9 said, we've had many threads on US Airways' cost structure, and his diagnosis is mostly correct. The airline's short-hop structure, combined from several high-cost pre-deregulation regionals, saddled US with costs it couldn't recover without more substantial transcon and transoceanic flying.

I'd say Edwin "sit on his ass and fiddle while US Air burns" Colodny was more the problem than Wolf. He didn't have it in him to tell the unions in the early '90s, concessionary contracts are needed NOW to save this airline. Colodny must have prayed a novena to get British Air to pour cash down the black hole of US's cost structre and save it in 1992.

Fleet rationalization would have come much sooner if Colodny had had some damn guts. One can debate if that shaping-up would have led to an earlier proposal to merge, or to a national-network viable US Air. But in any event, Colodny blew it big time.

And in any event, US Airways has never implemented near the transcon or tranoceanic system its network can support. Why isn't there a US BDL-LAX flight, for example, with that huge US frequent-flyer base in the BDL area? Why no San Jose service? Why so few 767's and no 330's on transcon?

Jim


User currently offlineFlashmeister From United States of America, joined Apr 2000, 2896 posts, RR: 6
Reply 6, posted (13 years 4 days 6 hours ago) and read 2238 times:
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That is one thing that Jim and I will agree on: Colodny was a buffoon when it came to managerial skill. He's the reason that US is where it is today.

Here are the problems:
- High cost structures: These aren't as easy to solve as just buying fewer paperclips and removing an olive per martini. US' cost structures are still the highest in the industry (I believe), and while they've come down, they're nowhere near where they need to be.

- Too big or too small: US is too big to be considered a regional - their footprint demands that they play with the big boys, yet their national network is puny.

- Few options for 'right'-sizing: Right-sizing can be considered either shrinking to be a regional or growing to be a national. They can't shrink and be profitable because of their cost structures (and it's a fundamental business fallacy that shrinking to profitability works), and they can't grow much, because they don't have the infrastructure for it. So they're stuck in the purgatory of air carriers.

- Low-fare competition: Southwest, AirTran, and jetBlue are most certainly impacting US. MetroJet is a complete joke. US has no way to compete. Southwest has already invaded Baltimore, Hartford, and Boston. They're setting their sites for sure on triangulating Philadelphia and New York City. AirTran is growing in Pittsburgh and already has some point-to-point routes from Philadelphia. jetBlue and Southwest are splitting upstate New York.

- Shrinking high-yield markets: As an effect of the low-fare invasion, US has fewer and fewer high-yield markets to prop up the balance sheet. That's why the 'years away from demise' argument doesn't hold water. Yes, this year they have cash, but next year when jetBlue/Southwest/AirTran/Spirit etc., strengthen in the market next year, the losses will accelerate and US will be in serious trouble much, much sooner than if everything was linear.

- Lack of alliances: US can't depend on a partner to handle the Int'l traffic for them. When you compare 'easy-to-get-to' destinations from PIT/PHL/CLT/BOS on US to the same type of destinations from ORD/IAD/JFK/BOS/EWR/PHL/etc. in Star or CVG/JFK/BOS/ATL on SkyTeam, it's clear that the alliance carriers have more to offer here.

- Mediocre FF program: Dividend Miles lacks the allure of Mileage Plus, AAdvantage, or SkyMiles, mostly because of the lack of partners and alliances. You can't use Dividend Miles, as far as I know, to get to Honolulu (except through the AAdvantage tie-up, which will end soon). Granted, we may not choose an airline based on this, but the cash-cow high-yield, frequest business traveller will.

- Threat of other shuttle services: Even if US-UA doesn't go through and the UA-AA shuttle arrangement doesn't happen, AA will have enough slots at DCA and LGA to start up a shuttle service in their own right. That would lure those cash-cow customers away from US even more, since enough trips on the Shuttle, and you can go to Hawaii.

These are today's problems. How did we get here?
- Colodny's woeful mismanagement of an airline
- Poor intergration of the predecessor airlines
- Failure to capitalize on routes and strengths of predecessor airlines, especially PSA
- Failure to recognize the low-fare threat years earlier, despite seeing it coming like a freight train (UA Shuttle is a perfect example of what US should have seen as a sign)
- Corporate culture that breeds inefficiency

So, that's where we are. US is at the point where they cannot stay in the same state that they're in. It's sort of like an atom being unstable... it MUST change in some way. No matter what they do, though, they're saddled with high-costs for the long-term and decreasing yields on many of their routes. Do the math. That's not a great business plan for the future.


User currently offlineCba From United States of America, joined Jul 2000, 4530 posts, RR: 3
Reply 7, posted (13 years 4 days 5 hours ago) and read 2216 times:

Seems to me that the only way to fix their ongoing problem is to cut costs in their cost structure. Easier said than done though.

User currently offlineSilverfox From United Kingdom, joined Mar 2001, 1058 posts, RR: 0
Reply 8, posted (13 years 4 days 5 hours ago) and read 2210 times:

Heeeeellllpppppp!!!!!!!

I dont like all this talk at the moment, at present i am finalising a SFO-BWI-MCO-YUL-DWI trip on the Air pass. bloody good value at 339 GBP. if this merger goes ahead before Sept. What happens to pre booked tickets???


User currently offlineAAtripleseven From United States of America, joined Jun 2000, 324 posts, RR: 0
Reply 9, posted (13 years 4 days 5 hours ago) and read 2201 times:

As pointed out by Flashmeister, there are many reasons why USAir is beginning to "sputter."

The recent invasion of low-fare carriers into USAir's territory is in response US's poor management. For years they dominated the mid-atlantic and northeast markets charging high fares and coupling it with mediocre service. US had a substantial presence on the west coast following their purchase of PSA. Bad decisions and neglect, however, dismantled their strength west of the Mississippi and handed Southwest the lucrative California market. Southwest, now bigger and stronger, headed east to Baltimore in 1993 and continues to make strides deep in US territory. As we all know, jetBlue is also profiting off of US's misfortunes.

US needs to better understand the demands of its markets and customers. Low employee morale and inconsistency are a recipe for disaster.


User currently offlineUS Air/TWA Fan From United States of America, joined Mar 2001, 125 posts, RR: 0
Reply 10, posted (13 years 4 days 5 hours ago) and read 2190 times:

US Airways can become a major competitor and is taking steps to do so. Reguardless of what Wolf says, US Airways can survive on its own. Wolf is both a positive and a negative for the company.

The good:

-The Airbus fleet renewal. This will save millions in training, maintainence, servicing, scheduling, fuel, and more. DC-9-30, 737-200, and MD-80s will be gone whithin a couple years (I dunno about MetroJets' 73S though). Long term retirements may occur in the F-100, B733, and B734 fleets. In years time the fleet will be an efficient A319/320/321/330/752/762 bunch.
-Building International trans-Atlantic flights.
-Increasing Carribean prescence.
-Modernizing PHL and CLT.
-New regional jet routes and service.

The bad:

-The merger hurts employee moral/confidence in leadership.
-The slow response to the new low fare carriers' invasion of the northeast.
-Inability to attract major international airlines for code shares/alliances.
-Lack of major routes to the west coast. US needs more...why not PDX, for example?
-Lack of major service enhancement initiatives domestically. US's service is improved, but it can be better.

Some suggestions:

-Continue building trans-Atlantic traffic.
-Continue Airbus fleet renewal.
-Order the A318 to compete better with lower density short haul or trans-Continental routes (like Reno, Salt Lake City, etc.)
-Start service to Honolulu, HI (probably from CLT or PHL).
-Shift some flights from BWI to PHL.
-Build up the three hubs: PIT, CLT, PHL.
-Consider adding a fourth hub, for better trans-continetal traffic, such as Kansas City, MO; Colorado Springs, St. Louis (depends on what AA does to STL), and more.
-Start trans-Pacific routes (possibly).
-Possibly discontinue Metrojet.
-Increase service enhancements.
-Increase profit...easier said than done.
-


User currently offlineLsjef From , joined Dec 1969, posts, RR:
Reply 11, posted (13 years 4 days 3 hours ago) and read 2165 times:

Interesting stuff, especially from Flashmeister, AAtripleseven, and DCA-ROCguy.

I think USA is truly in trouble. Yeah, Wolf is painting things more dire than he needs to in hopes of cashing out, but there is alot of truth to the concerns he illustrated to Congress with his maps of SWA expansion, etc. But, the bottom line is, as AAtripleseven noted, USA created the environment within which this expansion is thriving.

USA's route system is a bit undersized, but adding more destinations is not necessarily the answer. Take SJC or PDX. How much would it cost for USA to add a base for a limited number of daily flights to add spokes to a couple hubs? Would the facility and employee costs be recovered in sellable fares, or would price competition force USA to subsidize their new services to both of these new destinations? A few years down the road, would USA be able to expand these new destinations into profitable ventures? I doubt it...

There was a recent article about SWA expansion that noted SWA does not add a new city unless it meets certain criteria. One criteria was something like the ability to schedule eight daily departures, to ensure sufficient productivity from all the new employees SWA would hire at the new city. If USA applied this logic, they would need to schedule 2-3 flights per day to CLT, PIT, PHL and BOS from new cities like PDX and SJC. And both of these new cities have SWA, so USA would have pressure to offer competitive fares. Given these factors, as well as the established presence of other BigAir, I don't see how USA can make it with expansion to the western US.

In the long run, Wolf is correct: USA is in its last years.


User currently offline747-451 From United States of America, joined Oct 2000, 2417 posts, RR: 6
Reply 12, posted (13 years 4 days ago) and read 2127 times:

US Air is dead and about to be merged. Why bother...

User currently offline747buff From United States of America, joined Jan 2001, 724 posts, RR: 0
Reply 13, posted (13 years 3 days 23 hours ago) and read 2120 times:

According to my airline fleet list books, USAirways named a 767 the "Edwin I. Colodny". So will Continental eventually christen a plane "Francisco A. Lorenzo"?  Yeah sure


Northwest Orient Airlines: The world is going our way!
User currently offlineMitchell Gant From Montserrat, joined Aug 2000, 253 posts, RR: 0
Reply 14, posted (13 years 3 days 23 hours ago) and read 2111 times:

No, but CO does have a 777 named "Robert F. Six". Too bad US doesn't have a DC-9 named "Seth Schofield", the man truly behind the mess at USAir.

User currently offlineTsully From United States of America, joined Mar 2001, 651 posts, RR: 4
Reply 15, posted (13 years 3 days 23 hours ago) and read 2119 times:

WOLFE is any Airline's problem...
That's why we got rid of him at UAL.
tsully



I love America. I guess that makes me Bush's poodle, but I'd rather be a dog in New York City than a prince in Riyadh.
User currently offlineFlashmeister From United States of America, joined Apr 2000, 2896 posts, RR: 6
Reply 16, posted (13 years 3 days 23 hours ago) and read 2115 times:
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The problem, USAir/TWAFan, with some of your suggestions is that the routes you propose would be very low-yield.

HNL routes for most airlines are hardly cash cows. They're FF incentives. Icing on the cake, but not moneymakers on their own.

As far as service to PDX or SLC, it's already too late. Both are WN markets. US would have to price very low to be successful there, which would decrease yields.

See how this works? Where should they start flights out west? PHL-EUG? Hardly...


User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4467 posts, RR: 34
Reply 17, posted (13 years 3 days 23 hours ago) and read 2114 times:

Great post up below my first one, Aaron. That's one of the best summaries of US's problems I've ever seen.

I'm still not convinced that low-fare competition is going to gut US Airways in less than five or eight years, though. As long as Southwest continues to practice their "go to one airport in a region and make everybody else drive" strategy, US Airways will have high-yield traffic at many cities.

For instance, US has not trimmed its schedule at any of the four major Upstate New York cities despite Southwest's presence at Buffalo for six months now, and despite WN being at Albany for almost a year. Whenever I'm at ROC I see healthy crowds waiting for US flights, and those folks ain't paying low fares.

The numbers of US's last few quarters show that seat capacity has grown and *traffic has grown ahead of seat capacity.* I'm just pointing out the numbers--you'd think they'd be way down at cities where WN has invaded. Except at Baltimore, the most recent timetable does not show a decrease in US capacity at medium-size Northeastern markets that have Southwest.

If Southwest decides to seize market share by entering ROC and SYR (instead of just creaming our pax the easy way to BUF and ALB), then US might suffer the gutting you mention. But it's not happening even with WN there, according to the most recent US timetable. A mystery I can't explain, but there it is.

Jim


User currently offlineDesertJets From United States of America, joined Feb 2000, 7737 posts, RR: 16
Reply 18, posted (13 years 3 days 22 hours ago) and read 2105 times:

I am not completely familiar with the issues at USAir, but I am going to throw my ideas around and tell me if I am close.

One of the issues I have picked up on is that USAirways has still not to this day really fully integrated labor from the Piedmont and PSA mergers. And this is what really is contributing a large portion of the overall high costs. In order for USAirways to be successful again would require major revision of current contracts and work rules to get them in line with the rest of the industry.

Secondly, which has already been discussed, is that USAirways still lacks a presence as a national carrier. I cannot still understand how they could over the course of 5-8 years completely dismantle the entire PSA system. Arguably there were routes and equipment not worth keeping. But to buy a west coast presence and completely abandon it, only to have Southwest come in and fill the void! (this same arguement goes for AA and AirCal, though they seemed not to have done it again with Reno).

Now for the Monday quarterbacking. USAirways needs to concentrate on their 3 main hubs, PHL, PIT, and CLT. And keep operations at high yield O&D airports. It would be corporate suicide to give up those highly coveted DCA and LGA slots (though this seems to be what would happen if the merger goes). Metrojet could probably be done away with. I don't think trying to battle Southwest is the right thing to do. Yields are too low anyways, and some of the routes do not make sense. Then USA needs to rationalize their regional network. Either sell-off the wholly owneds or bring them altogether under one banner (a. la. COEX or Eagle). And then they need to get more RJs. I belive only Mesa and maybe TSA are flying them for USExpress. Lastly USA needs to continue its expansion across the atlantic, but they need to be more aggresive, sort of like Continental. Certainly Philadelphia is a large enough O&D market with enough connection pax to fill a 762 to secondary European cities.

I find it hard to believe that USAirways is on its deathbed. What is needed is smart management who want to make it a strong independent carrier, not groom it for purchase.



Stop drop and roll will not save you in hell. --- seen on a church marque in rural Virginia
User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4467 posts, RR: 34
Reply 19, posted (13 years 3 days 22 hours ago) and read 2112 times:

LSJef writes: <>

This isn't true, LSJef. Neither PIT, CLT nor PHL have Southwest. None of them are likely to soon; Uncle Herb rarely challenges major airlines at their hubs. He picked BWI because US was abandoning it and he knew they would concentrate their resources on the Big Three hubs rather than defend BWI fully.

Also, most of the cities that feed PIT, CLT, and PHL on the East coast do not have Southwest. There is a *lot* of strength at these hubs to support cross-country traffic. Especially with O'Hare the way it is, US could pick up a lot of transcon traffic in the East. I'd transfer thru PIT or CLT any day before I'd go to O'Hare. This is a big marketing advantage US does not exploit. I wonder why? Hmmmm...

US could easily be filling A330s to LAX, SFO, and maybe even SEA. They could be filling 762's to SAN. And they could certainly fill 752's if they wanted to SJC, SNA, OAK, and PDX. They could also ramp up at PHX. Again, US's Big Three hubs and most of their feeder cities *do not have Southwest.* And even at some cities that do, WN isn't going to run non-stop service all the way to LAX. As I mentioned above, BDL-LAX should have been a gimme for US. Whatever the limits of US's frequent-flyer program, their flight schedules at mid-size Northeastern cities suggest a lot of travelers are hooked on it.

This has been a major management mistake by both Colodny and Wolf.

And no, US does not have just three years to go. They have at least five to danger, eight to ten before bankruptcy. The only serious threat comes if Southwest were to enter PHL, PIT and CLT; stop making so many cities driver to their neighbors and seize market share at *all* medium-size cities in the East. Then US might be in trouble sooner. That's the big question mark, but I don't see WN expanding that rapidly that soon. US has time.

Jim



User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4467 posts, RR: 34
Reply 20, posted (13 years 3 days 22 hours ago) and read 2104 times:

Side note about Baltimore: If US shuts down MetroJet, they will again have vast vacant space in Concourse D. Which US will probably try to sit on, as they sat on it from 1993 until MetroJet's founding in 1998 to keep it out of Southwest's hands.

I'm not sure of the wording of the lease agreements, but if they leave all that space vacant, Maryland should aggressively seek to get it back. Groundbreaking has started on the new terminal expansion to the northeast of the mini-A concourse that UA uses, so maybe Maryland is just doing an end-run around US. But it seems to me Maryland has a good opportunity to wrest gate capacity that could be put to good use. BWI is an excellent airport in a swelling two-metro area market.

Jim


User currently offlineONT 737 From United States of America, joined Mar 2001, 584 posts, RR: 2
Reply 21, posted (13 years 3 days 22 hours ago) and read 2095 times:

I must agree about how US Airway's route structure is hurting them. I'm from California and have never flown on US and probably never will. I think that most travelers who live west of the Mississippi are saying the same thing. Their fairs are high and unless I want to fly somewhere east of PIT I can pretty much count on back tracking when I fly on them. Also their hubs are pretty close together so they compete with eachother for connecting traffic. The one thing good about their hubs (PHL, PIT, CLT) is that they just dominate them. (In that I mean the US share of the market) Maybe is they have a codeshare with a west coast airline people out here may be more likely to fly them.  Confused


"The world is run by C students"-Harry Truman
User currently offlineAirwaysdc9 From United States of America, joined May 1999, 204 posts, RR: 3
Reply 22, posted (13 years 3 days 15 hours ago) and read 2091 times:

Just a word about Market Share.

Lets just say for a moment that the merger tanks and Mr. Wolf decides that he's going to expand US Airways and make it a true nationwide carrier. Aside from the expense of buying new aircraft, ground equipment, hiring thousands of employees, expanding infrastructure and information technology to new stations...all of which cost big bucks...he also has the burden "stealing" market share from airlines that have long since been established on the west coast.

No, it is not impossible....but it ain't gonna be easy folks. Go up to anybody in Oregon and they'll say, "US Who???"

As for Jim's "5 years to danger 8-10 to trouble" timeline...I think that is dangerous speculation. Jim hasnt seen the books and neither have I. We dont know cashflow rates. We dont know how the upcoming parity reviews on numerous contracts are going to effect costs. We dont know what the 5 or 10 year forcast for low fare competition in the northeast is. We dont know the ultimate impact on RJs on the air traffic system and how that will be dealt with. Bottom line we dont know what will happen to YIELDS and COSTS in US Airways core markets...

But here is a pretty basic guess....Southwest, Jetblue, AirTran etc...continue their expansion in the northeast. High yield travelers seeking better FF benefits are lured away from US Airways by competitors RJ's = YIELDS GO DOWN.

Contracts at Delta, UAL, NWA etc raise the bar on the "PARITY CONTRACTS" that Steve Wolf gambled on at US Airways.... Airbus fleet rationalization will continue to actually RAISE costs until more fleet types are parked... = COSTS GO UP.

If YIELDS GO DOWN...and COSTS GO UP....who are we to say that it will be 5 years or 10 years to trouble? Fact is, 5 years ago would we have had any incling of the massive increase in low fare competition on the east? 5 years ago would we have any idea about the massive popularity of regional jets? Why should we presume that we know what will happen 5 years from now?

The only thing we DO know is that unless US Airways can solve the problems that Aaron, Jim, and myself have mentioned at SOMETIME in the future...the near future in my opinion, US Airways will be in a lot of trouble...and Steven Wolf's ONLY obligation is a feduciary responsibility to the shareholders....not to the employees....not to the customers....not to the cities he serves...but only to the shareholders.

That means, ladies and gentlemen, that if Mr. Wolf feels he can get $60 a share by melting down the airplanes, turning them into Coca-Cola cans and selling them at 7-11...thats what is going to happen.



User currently offlineTan Flyr From United States of America, joined Aug 2000, 1897 posts, RR: 0
Reply 23, posted (13 years 3 days 14 hours ago) and read 2079 times:

Well, I have enjoyed reading this interesting discussion for the last 15 min. Decided to add my 2 cents worth....Airwaysdc9, you make a correct point, Wolf's responsibility is to the shareholders. If he can melt aircraft into Coors cans and make a profit, he will. For better or worse, his style in life has been to put carriers into positions to be sold. Flying Tigers was first I believe, the Republic, UAL(to employees), and now US.

The few times I HAVE to fly US when I am in the east, I do. However, they have a lot of problems that have been mentioned already.

IF the UA/US deal fails, and I think it will, look for Wolfie to sell it off piece by piece.

Capitalism at work, maybe for the eventual benefit of shareholders and consumers in those markets. Maybe more competition will eventually result? Lets hope so!


User currently offlineLsjef From , joined Dec 1969, posts, RR:
Reply 24, posted (13 years 3 days 14 hours ago) and read 2074 times:

DCA-ROCguy:

I continue to agree with you about SWA's conspicuous absence at major hubs, which includes USA's hubs. Just to clarify, though...my point was to note a key limitation of the hub system, that each "spoke" airport must be able to support limited flights to only the hubs. Given USA's limited hubs and the existing competition already serving PDX and SJC, I simply cannot see USA forging profitable new services to these cities without first taking a loss for 3+ years. And I doubt USA can afford to take that loss...


25 RayChuang : I think (as everyone guessed correctly here) that the big problem with US is the fact their route structure is too East-loaded. I mean, look at airlin
26 Airwaysdc9 : "Getting a hub" Ray Chuang? Tell me...how do you steal market share from established carriers. It just isnt as easy as building a new terminal at Kans
27 DCA-ROCguy : LSJef, it doesn't seem to me that US would have that much difficulty taking market share on transcon from the East. PIT and CLT are not congested airp
28 Lsjef : DCA-ROCguy: Your point is well made, and I agree with you that USA has some opportunities. But, whatever service USA provides out of places like PDX a
29 US Air/TWA Fan : I know some of these would be low yield flights. That is why an effiecient A319 or A318 would be perfect for reclaiming US Airway's trans-Con West coa
30 Ladevale : DCA-ROC argues - "Plenty of people in fare-gouged East coast markets still need to fly cross-country. US should chase them aggressively. And watch the
31 Post contains images ONT 737 : Many poeple on this forum have mentioned that US should build a hub somewhere in mid-America. I think that it is a good idea as well, but the problem
32 Lowfareair : US has several things to do for them to lower costs: 1. Give back the gates at BWI. They can have some, but not all that they have now. They can stop
33 DCA-ROCguy : US Airways can park wide-bodies at LAX Terminal 1. I've flown a US 767 from that very terminal. Just last August I saw a US 767 at LAX. They most defi
34 ContinentalEWR : CLT, PIT, and to a lesser extent, PHL are great alternatives to ORD, ATL, EWR, LGA, etc...but US Airways is an also-ran, with lousy service, the absen
35 Flashmeister : I don't know if US has all that lousy of service when compared with the other majors... they've been 'normal' when I've flown them. I don't think, how
36 DCA-ROCguy : US Airways service has consistently been good on my many,many trips with them the past ten years. The planes are clean and roomy, the food good on tra
37 DCA-ROCguy : AirwaysDC9: The only thing we DO know is that unless US Airways can solve the problems that Aaron, Jim, and myself have mentioned at SOMETIME in the f
38 Flashmeister : Jim, I can see where you're coming from by saying that the market should determine the fate of US, but be careful here. There was another airline that
39 Tupolev154B2 : If U.S. were to sell the rest of its DC-9, MD-80, Fokker and 737 fleet, their capacity would be greatly reduced. What you must ask is whether the prof
40 DCA-ROCguy : Consolidation is indeed going to happen, but not this year and not in the form the airlines want this year. US will be gradually downsized, and other
41 Lsjef : DCA-ROCguy: in your last post you said, "Best scenario would be that different carriers buy chunks of US big enough, that each could take over one of
42 Republic : Bethune agrees. Wolfe. US Airways at Mercy of Merger Deal Management Is Gloomy About Airline's Fate Without United Deal, but Its Competitors Disagree
43 Flashmeister : The big assumption that you make, Jim, is that US will be carved up, and I don't think that's what's going to happen, at least not right away. If the
44 DCA-ROCguy : I don't believe the financial outlook Wolf & Co. are presenting. As the article notes, they are "deal guys." They couldn't care less about trying to m
45 Jmc1975 : As an airline analyst, I see that USAirways can definately survive on its own if it takes several preacutionary steps. There is such great potential f
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