PVD757
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Next Strategy For US At PHL?

Wed Oct 29, 2003 1:02 pm

I'm sure everybody knows full well the impact that WN had on the aviation community Tuesday. US has to be reeling about the news. If you were in charge of US, what would you do to combat the presence?
 
SunValley
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:06 pm

Well for starters, they should reduce their fares, and start a frequent flyer program as simple as that at WN, and offer a companion pass to those who
fly 50 segments within a 12 month period. But, they won't, and WN will
prevail in PHL, jsut like they hav ein every other city they hit.
 
Flaps
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:14 pm

R E T R E A T

Im sure the folks in Alabama could make a case for moving the transatlantic hub to Montgomery....Oh wait, maybe that is just a tad too close to WN in Birmingham. Hee Hee.
 
SHUPirate1
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:21 pm

I'm sure what US will actually do is take their head, stick it between their two legs, and kiss their rear ends goodbye...as a frequent US Airways traveler, I'm actually slightly angered by the news...I'm one of those people who doesn't particularly like WN, because they never have decent advance-purchase long-haul fares, and because I'm not a big fan of their first-come-into-seat, first-serve (unless you get up) seating...additionally, their sole competitor on a lot of routes that I fly with US is Delta, and I am not exactly fond of the Atlanta-based carrier...right now, I'm just counting down the days until US Airways gets bought up, hopefully by American...
Burma's constitutional referendum options: A. Yes, B. Go to Insein Prison!
 
StevenUhl777
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:25 pm

Reducing fares even further (whether they need to or not) will put increased pressure on US in an already extremely tight (that's putting it mildly) revenue environment, and going into the winter months, that doesn't bode well for US, who has already posted a larger than expected loss for Q3.

Not knowing a lot about US, my proposals are either going to be limited in scope or way off base. But, I'll take a shot:
- If possible, put 737 or possibly RJ aircraft on routes that will compete with WN.
- Offer the same incentive plan on only those routes that will compete with WN.
- Hope that WN is hampered by delays that seem to plague PHL (as mentioned above)

I don't know...SunValley is very right in saying WN can apply their model anywhere and come out on top. Given that, I have no doubt that WN researched very carefully this PHL market vs. other options for a long period of time, and chose PHL for many well-founded reasons. This is only going to put more pressure on US this winter, how they respond will determine how strong they will continue to be in the east.

And the winner for best actress is....REESE WITHERSPOON for 'Walk the Line'!!!!!!!!
 
usair330
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:28 pm

Introduce lower fares in the same markets as WN with the Embraer 170. Advertise these lower fares on Television and do like virgin by writing on our planes.... maybe something like
" No SW at PHL"
"Fly US, we're patriotic"
"We fly to all four corners of the US"
 
SunValley
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:31 pm

Wait till you see the marketing campaign they will undertake when they open up PHL. It is so unbelievable US will in no way meet the splash they make.
 
SHUPirate1
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:39 pm

I think the only chance US really has is to start having the dark blue A-330's flying from PHL to just about every city in Europe that Dave Siegel has ever heard of...otherwise, I better enroll in Mileage Plus...
Burma's constitutional referendum options: A. Yes, B. Go to Insein Prison!
 
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mariner
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:40 pm

They've already announced what they will do next - ask for more pay cuts from the staff.

Their basic problem is that, despite the bankruptcy, they still have a very high CASM.

They've also lost money since they came out of bk - even during this past summer which was a junior bonanza for many airlines.

So they have a problem lowering fares because they'll go even deeper into the red.

On balance, I'm with Shupirate1's first sentence.

cheers

mariner
aeternum nauta
 
SunValley
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:40 pm

I'm afraid the Bird with the UPC flag on it's tail may be on its way out of PHL to the extent it has been there.
 
N79969
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:41 pm

I think this could break the back of USAirways. I would wager that they are going to fly to LAX, OAK, MDW, PHX, LAS, STL at a minimum. They are going to eliminate the cream that USAirways has been depending on in PHL.

If I were USAirways, I would be locking in corporate customers that use PHL heavily (e.g. Merck) with some long-term sweet deals. Since fares are bound to drop, best to steer whatever dollars your way.
 
COEWRNJ
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:48 pm

SHUPirate1
I wouldn't be joining mileage Plus so quick. Who knows what's going to happen to United in the future. And if the reason your joining MP is because US is gone. Well the alliance with US is one of UA's backbones out of Chap.11. I think if by some chance US fails UA would be shortly after it. UA may even fail without US going under.
 
USAFHummer
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 1:58 pm

SHUPirate...I'd start using your Dividend Miles ASAP...I for one am getting rid of them realllll soon....WN in PHL is the knockout blow to US IMO...

Greg
Chief A.net college football stadium self-pic guru
 
PVD757
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 2:06 pm

I believe that US HAS limit their exposure to WN's presence. If you ask what that means, then follow my thinking. Right now WN gets 4 gates. They have said in the past that they can comfortably do 10-11 flights/day per gate. That maxes PHL out at 44 flights/day. If I was US, I would buy up every gate imaginable at PHL just like BA does in LHR. If they can limit their exposure to 40 flights/day to WN, they will survive on the other routes and hopefully generate enough International traffic with Star. As an example of what I mean, look at DTW for example. WN had been up there for a while now and have neither wanted to or have been able expand their presence. NW is probably losing their shirt on competing routes, but has figured out how to make up for it on noncompeting routes with higher yields. US has to make sure that WN cannot get enough gates and flights out of PHL to mortally wound them in the long term. I feel that this is the final showdown for both. If US wants to stay in business they cannot retreat from PHL. Their investment in the airport is astronomical and would deal them a death blow.
If they can afford to lose MCO, PHX, PVD, upper New York state and some other revenue generating markets, they could live a little longer. Worse case scenario is that they will buy out Mesa and ACA and become a regional feeder for UAL and Star............................................ Crying
 
SHUPirate1
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 2:27 pm

I doubt that the DOT would allow US to ditch upstate New York...Jamestown, Massena, Ogdensburg, and Watertown are all served only by Mesa-owned Air Midwest Airlines (US Airways Express) from PIT...

COEWRNJ-welcome to my respected users list...thanks for the advice...

[Edited 2003-10-29 06:37:04]
Burma's constitutional referendum options: A. Yes, B. Go to Insein Prison!
 
PVD757
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 2:34 pm

I was referring to BUF and other WN destinations, not necessarily the small jumps.
 
AA717driver
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RE: As Time Goes By: Many 767s Bound For Scrapping

Wed Oct 29, 2003 2:43 pm

This is bleak. The best advice is to buy up all the gates at PHL... Maybe they should try to buy out the next 5 year's supply of 737's to keep SWA and AirTran from adding flights. Big grin

Allegedly(from a pretty good source), the USAir VP of Finance said they were on the brink of insolvency. I don't know why he would have said that in the forum in which he said it(semi-public), but who knows?

USAir was is deep s*** two days ago and today didn't help. Here's to hoping the teachers of Alabama get to enjoy a taste of what the USAir employees have when it's time to retire... Sad TC
FL450, M.85
 
PVD757
Topic Author
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 3:49 pm

Do you think that any of the creditors are sweating bullets right now?
 
cloudy
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 5:28 pm

Even assuming WN does build a huge station at PHL, USairways could survive. America West survives against WN in Phoenix and Las Vegas. But USairways would have to radically alter their cost structure in order to pull this off.

My suspicion is that WN intends this mainly as an O&D airport. They just need to cover the population that is close by and is only served by network carriers to most destinations. It will end up kind of like LAX is. It will get a fair ammount of WN service, but it will by no means be a major "hub".
 
A330323X
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 5:30 pm

US can't "buy up" gates at PHL, because the airport is not signing any new exclusive-use agreements. It's not like BA at LHR, because LHR is slot-contolled and PHL is not. (On the plus side, there are probably a few more gates to use for WN in the future, but none more in Terminal E, making it difficult for WN to expand.)

What I would suggest US to do is a bit unorthodox. I think the only way WN will pullout of PHL is if the delays are just too much of a problem. Remember the nightmare of LGA a few years back when everyone opened a million and one new commuter routes? Well that's what I suggest US should turn PHL into. Fly every plane it can find through PHL as often as possible. Turn the place into a total parking lot. They can bully around FL on routes like PIT-LGA, PIT-MDW, PHL-PIT (and PHL-BOS), but it's not going to work against WN. This calls for some drastic measures. I just don't think that US management is capable of thinking outside the box.
I'm the expert on here on two things, neither of which I care about much anymore.
 
PVD757
Topic Author
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 7:02 pm

Who do you think they could move from E to say D if the gates in D were available? What about moving UA down to where US runs out of in B/C?
 
uadc8contrail
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 7:23 pm

coewrnj,
if us goes under why cant we take a page out of the co book of economic/stratagey bk filling???aka(lorenzo school of aviation mgmt)..do you really think ua will come out of bk when us is going under????they will duck and hide till the time is right all in the guise of the bk court,,,,,,,my bet is leo will take the good ol boy network into judge wedoffs bankruptcy room of horrors in chicago-atl annex and make fl the real bitch
bus driver.......move that bus:)
 
usairways85
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 8:06 pm

Currently at D, US holds two gates that i'm sure the city has been trying to get back from them for a while. Other than that America West holds 1 and Continental holds 2 and there is 1 unused gate. For an airline at E to move to D they need at least 3 gates. Currently NW and Delta are the biggest tenants at E an NW has 3 gates and Delta has i think 5.

So it's possible if SWA really wanted more gates at E that the city could try to get NW to move to the 3 gates at D if they got the two back from US. However, Airtran is steadily expanding in PHL with 19 daily fights in Feb., and i am interested to see what they do after this SWA announcement. Currently Airtran holds 3 out of the 4 new gates built at D this year. It can easily pick up the 4th and make it just about impossible for any airline to move from E to D.
 
A330323X
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 8:25 pm

I think FL does have all 4 new gates in D, even if it's only using 3 right now. Anyway, FL's old gates in F are available, and there are probably some gates in A-East available too. NW won't move out of E because of the WorldClub. DL also has a club, but its club is outside security and would probably be a bit easier to move, still unlikely though. That just leaves TZ and YX.

Speaking of security, flying out of E is already a nightmare with that awful bottleneck. This is going to be an absolute disaster, since there's no more room to add more security stations, and you can't get into E from any of the other terminals.
I'm the expert on here on two things, neither of which I care about much anymore.
 
usairways85
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 8:43 pm

On airtran's website it says they only hold 3 gates at D, but i'm sure they've often looked at eventually taking the 4th, especially now.

There is not much room at A-East. Don't think that just because US went to A-west that the terminal is now empty. In reality US was only parking about 2 or 3 international planes at the terminal and the rest were remotely parked. Now American holds 6 gates i believe. And British Airways, Air Jamaica, USA 3000 use the international gates. Currently Air France arrives at one of the new A-west gates and departs from E and Lufthansa I think just recently switched from A-east to A-west. So you might be able to move YX because they only have 2 flights but thats about it.

There are no gates at F, Airtran was using US Express gates and US wanted them out as soon as possible. The only reason they were there was because their gates at D were being built. Don't expect anyone but US Express at F for a while.
 
9844
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 8:48 pm

One point no one has made is the stampeed of US AIR employee's that will go to WN.... That will hurt. The Alabama state pension guy should have learned from history and Mr. Buffet. Airlines are a bad business......
 
SunValley
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 8:59 pm

The news for US in the last few weeks is pretty bleak. ON one hand they are hit with WN opening up in PHL, and at another of their strongholds (PIT) they get the news of a new LCC setting up shop. They then post a $90mil loss during the last quarter. History shows that WN will be extremely aggressive in their conquest for dominance at PHL. (past behavior predicts future performance). They also have another LCC in their immedaite strong hold area, area that being B6.
So, now the only city they can really "control" with higher fares they are accustomed to is CLT.
If US's past (past performance predicts future behavior) shows anything, it is kind of like run as fast as you can with your tail between your legs. (Not 1 route is left of the PSA acquisition, & look what they did at BWI)
US has not been proacvtive in attempting to re-invent themselves as the peoples choice in their areas. Most people in these markets view US as something that "puts the screws" to them, and are delighted to see LCC's begin to take some of their business. (this should serve as a lesson to the NW at MSP & US at CLT)
HP seems to be doing a great job re-inventing their public perception as a
higher end LCC. They are proactive in establishing some point to point service rather than the hub & spoke operation. It is also interesting to note that WN has mulitudes of thru plane service routes. For instance, their service from GEG to RNO usually makes 1 stopenorute in BOI, or one or more of their flights from PHX to BNA makes a stop in AUS. As WN opens up service in PHL, they may have a flight that has a PHL-STL-SAT routing, thereby giving PHL thru plane service to SAT. This is something WN is very good at, and gains a lot of local city traffic, because it is more attractive to have 1 stop with no change of planes, rather than to have to endure the flight bank at a hub. Their revenue & planing departments also use this information on boardings to thru plane cities to gauge future growth for N/S routings.
(this can be done when your are not reliant on hub & spoke banks like US, UA, AA, DL etc is.)
With that being said, it amazes me how US makes no attmept to reinvent them selves as a higher end LCC (such as HP is doing), and makes no attempts to create any point to point non hubbing traffic, and makes no efforts to be proactive in becoming a "fare-setter" in any market. I would think that in looking at whats going on around the nation they would pull their proverbial head out of the sand, and get a "clue".

 
AirT85
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 10:48 pm

As said earlier, USAirways can't fight by locking up gates-the city of Philadelphia is currently trying to force USAirways out of some of its leases. They aren't happy with USAirways dominance of the airport. Kudos to them for getting WN in here to solve that! A lot of people here love WN. Many drive down to Baltimore to hop on their planes. A lot of Central PA'ers do the same thing (from out in Harrisburg etc) so we could see some of them just shooting down the turnpike until they hit PHL.

Personally, yesterday was a sh!tty news day for USAirways. First-the largest discount airline in the world unveils plans to launch service to their most important hub with up to 40 flights a day at some point, and then two of their planes land with box-cutters onboard. Not good when you're trying to pull yourself together and put on a happy face!

I am happy to see Southwest here. There marketing has been here through the NFL for a while and people think their commercials are hysterical. I can't wait to see more of them  Smile

-Tony

PS-Southwest *does* need to let the public know who they are, though. One mad interviewed on NBC10 was qouted as saying it will be nice to have Southwest here because it will make his flights home to Mexico cheaper. Umm...here's to WN not serving Mexico!
Why would God make us all so different, if He wanted us to be the same?
 
727LOVER
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RE: Next Strategy For US At PHL?

Wed Oct 29, 2003 11:19 pm

and then two of their planes land with box-cutters onboard

HUH???!!! WHAT'S THIS????
Love Trumps Hate
 
GSPSPOT
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RE: Next Strategy For US At PHL?

Thu Oct 30, 2003 12:48 am

I'm all for low fares, but the thought of having to fly WN depresses me. Their planes are (or a least were) murky inside, and I NEVER found them to be comfortable. I call "service" more than wise-cracking employees. I hate to see US fall, but I'd rather see Airtran or that ilk replace them rather than WN. Maybe ATA??
Finally made it to an airline mecca!
 
aaway
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RE: Next Strategy For US At PHL?

Thu Oct 30, 2003 1:24 am

Depends on the markets WN decides to serve. Short hauls - replace mainline US with RJs. US will still be at a cost disadvantage, but the disparity will not be as great if US were to continue operating mainline in such markets.
Long hauls - US has hope here. I believe US can stave off WN on long hauls with superior product. Still cost disadvantaged, but somewhat blunted by the longer stage-lengths.
Medium hauls - Don't have any answer. This market segment has got to be the most problematic for US vis-a-vis WN. Historically high fares, yet a product that hasn't, and probably will not continue to, differentiate itself from a WN product. Not exactly an appropriate market for RJs...PHL-MCO???...
Interesting days ahead at US.
"The greatest mistake you can make in life is to continually be afraid you will make one." - Elbert Hubbard
 
VectorVictor
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RE: Next Strategy For US At PHL?

Thu Oct 30, 2003 2:21 am

Well they could strike right at the heart of Texas by opening nonstops from Austin and San Antonio to their hubs at PHL and Charlotte.

Not a big salvo by any means, but you take away some of WN's BWI connecting traffic from each of these cities. (each now has 2x nonstops per day to BWI)