aeroman62
Posts: 146
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UA/Bankruptcy Ironies

Sun Feb 08, 2004 2:27 pm

Does it seem odd to anyone that a bankrupt airline (which has been bankrupt for over 12 months, and keeps postponing its emergence from bankruptcy every six months) is (a) spending a great deal of money on starting a lcc knockoff with a goofy name, which is essentially their coach product, but costing them millions in $ to rebrand (when they could have just taken out the first class seats, and sold it as an all coach product under the United name), (b) repainting their entire fleet, (c) engaging their union employees to the point of acrimony on give backs, while they spill $700 or more an hour on legal fees, and have some ex-oilman running the place.

I don't get it, nor do I grasp how they will ever get out of this, given the fact that they still bleed millions in losses each quarter (although the amount of loss is going down)(on the other hand, a $100 million something loss is still pretty bad compared to a profit at WN).

Bottomline, there are too many airlines in the US, many of which have legacy, flawed business models, who aren't figuring out how to simplify their operations, and provide the services the flying public requires.
 
syncmaster
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 2:34 pm

"Bottomline, there are too many airlines in the US, many of which have legacy, flawed business models, who aren't figuring out how to simplify their operations, and provide the services the flying public requires."

And flawed business models is what UA is trying to fix. Read some of the other NUMEROUS topics on this same subject, you will find that what they are doing is actually probably for the best.  Big thumbs up
 
aeroman62
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 2:37 pm

Rebranding their coach product as TED, and spending millions to do this, doesn't sound like a good business model.
 
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ramprat74
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 3:10 pm

It doesn't cost them more to repaint their planes. They have to repiant them on there D-checks.

UA is making 7 million a day and not losing money.
 
syncmaster
Posts: 1926
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 3:11 pm

First of all they are not re-branding their coach product Ted, they are starting an additional service called Ted. Not to mention the fact that they have not said they are spending millions doing this, in fact, it's probably been fairly cheap. Cheesy marketing, the plane would need to be re-painted either way, and taking seats out is not necessarily expensive, what about this is not a good business model?
 
AirT85
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 3:19 pm

I think United is being smart by not rushing out of bankruptcy. US went in and got out ASAP and look at them now...they're knocking on deaths door.

Nobody here can say for sure whether or not TED will fail. It remains to be seen. Personally, I applaud United for the effort. At least they are doing *something* to try and fix segments of their operations that aren't performing well. Once again-one only needs to look at USAirways and see what happens when you don't.

-Tony
Why would God make us all so different, if He wanted us to be the same?
 
FA4UA
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RE: UA/Bankruptcy Ironies

Sun Feb 08, 2004 7:37 pm

can we beat a dead horse a little more please?

Ted is responsive move to the market conditions. The long term goal of TED is to reach Leisure destinations. As leisure travel is the fastest growing segment in the States and since UA has very little service to leisure markets it's a smart move to bring this cost effecient "vehicle" to reach that goal. Marketing for TED has cost less then $200,000! I just went through training and that was one thing they said right up front (since the biggest critics of UA are the employees!).

Painting planes needs to be done through the D-checks anyways... the new paint job will eventually end up saving money as well as adding a huge psychological benefit to employees and passengers as we re-emerge.

To piggy-back on to what AirT85 stated above, it isn't a race to get out of Ch. 11. It's best to have our house in order for long term stability!

Granted, UA has some challenges ahead.

Ted hasn't even launched so we don't know how this move will work long-term. I do know that advanced bookings are way up and it's a very positive sign that things are looking good with the business model since they're adding it to IAD.

UA also has recently done some damage internally by moving for the bankruptcy court to change retiree medical benefits after promising they would leave them alone. This is caused an enormous upheavil which was recently seen globally as Flight Attendants and other work groups did informative picketing world wide.

Check your facts before posting: Operationally we're making money... so don't even go there! Lawyers are never cheap and totally necessary when we're talking the largest aviation bankruptcy in history. Was that really a suprise to anyone?

FA4UA
The debate continues... Starwood or Hyatt... which is better
 
Iflewrepublic
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RE: UA/Bankruptcy Ironies

Mon Feb 09, 2004 8:39 am

FA4UA...

I'm just wondering, correct me if I'm wrong, doesn't the catch phrase on airliners.net seem to be "Check your facts, first"? If people could do that, it would save everyone, you yourself, so much trouble.

All of us, not just United, have a long, long road ahead of us.

Iflewrepublic.
Aviation is proof that, given the will, we have the capacity to achieve the impossible.
 
UALPHLCS
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RE: UA/Bankruptcy Ironies

Mon Feb 09, 2004 11:45 am

Where is the irony? What is ironic?

I do find it ironic that those who say the LCC model is the way of the future laugh when other carriers take a page from the LCC play book. Why is it that only WN, B6, FL and F9 can be all coach, quirky, fun and cheap? If they have the monopoly on those criteria how long before they become as complacent as AA, UA, CO, NW and DL became?

That is the ONLY irony in this thread so far. "Legacy" carriers can't make it with their current model according to the wise and all knowing airliners.net crowd. But they are stupid for even trying to change, unless the carriers in question are Jetblue, or Southwest.

I wonder how ironic it was for Valujet to repaint their planes and rebrand themselves.

Same drivvle we have been hearing for well over a year. Now its just someone new saying it. Sorry to jump on your case Aeroman62, seeing as you are new, but this path is well worn, and most of the old arguments about UA's stupid management have NOT held water. So excuse us for being skeptical, that you argument will hold any water either.
A little less Hooah, and a little more Dooah.
 
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airzim
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RE: UA/Bankruptcy Ironies

Mon Feb 09, 2004 3:12 pm

UA is not being particularily inovative or leading edge on this one. The "airline within an airline" has never worked, will never work, and is a doomed to failure from the start. AC (Tango), DL (Express and Song looks shaky), CO (Lite), UA (Shuttle, that is ironic), and US (Metrojet). All failed. Show me the difference from what UA is doing fundamentally. Not much.
 
uadc8contrail
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RE: UA/Bankruptcy Ironies

Mon Feb 09, 2004 3:43 pm

aeroman62,
ua said a year ago dec that they expected to be in judge wedoffs court room for at least 18 months, there were some press reports coming out a year ago that ua might be leaving early but that was denied by jake brace, ua has said from the get go that they wanted to be out around 2q of 04....

airzim,
contrary to popular belief....ua shuttle was a money maker and it worked....it failed when the summer of 2000 came upon us and wreaked havoc on everyone, i hope that ua has learned from that and tweeked the formula to make it right this time, at least the 320 pilots are going to be paid the 300/500 rate thru 2009, so if they at least follow that biz model that they had before 2000 then there is no reason it shouldnt work.








bus driver.......move that bus:)
 
UALPHLCS
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RE: UA/Bankruptcy Ironies

Mon Feb 09, 2004 11:49 pm

United Shuttle was making money but Goodwin pulled the plug after 9-11. Why? Because this was the same guy who's leadership got us into Chapter 11 in the first place.

I won't deny UA has made some boneheaded decisions. But Those decision makers are out looking for work at other airlines right now. (God bless the airline that hires them.)

I fail to see how the "airine with in an airline" has been proven dead. Are not Comair and Airlink wholly owned and integrated into the DL and NW system? What makes you think that done correctly the same can't be integrated with A320s.

Another thing that is consistantly overlooked is Ted's simplified fare structure. EVERY airline desperately wants to simplify the fare structure that they have right now. It is confusing, expensive, and annoys passengers. But no airline has been willing to make the first move in simplifing thier structure. Ted is UA's move. That is truly innovative. No airline has done that.

Additionally so what if Ted isn't "leading edge" as you called it. Auto manufactures had airbag technology since the early 70s. Yet they didn't begin to install it until someone made the first move. Were the automakers who added airbags second stupid for following suit? Or smart to realize they wouldn't be able to compete without them?

You seem to want UA just to roll over and die, without trying to change, all the while complaining that if they became more like LCC's they wouldn't have these problems. You can't argue both.
A little less Hooah, and a little more Dooah.
 
ordpark
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 2:06 am

FA4UA - I had this big long list of things I was gonna add to this but you covered most of them.....nice post...

Some people are gonna be critical of ANYTHING UA trys - as UAPHLCS said, some people want UA to just roll over and die, and I'm sorry to disappoint them but that's just not gonna happen!

UA will not exit bankruptcy until EVERYTHING has been addressed and corrected and yes it's VERY expensive to be in bankruptcy.(I should have listened to my Dad and become a lawyer - but that's a whole different post).

Things are falling into place and when UA walks out of the courtroom for the last time, It will be more than ready to compete.
 
caetravlr
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 2:46 am

I pretty much want to second what most people on here have said.

It takes money to run a business, and sometimes that means investing in change. If the $200,000 in marketing expenses for Ted is accurate, then that is dirt cheap, relatively speaking. Also, as others have pointed out, UAL is actually saving money on scheduled maintenance by simpliflying the new livery. Also, if Ted is such a flawed business model, none of the stakeholders (i.e. the DIP lenders) would have signed off on it, and it would never happen.

If you have a fundamental understanding of business, a lot of these things make sense, although times are still a bit scary.
A woman drove me to drink and I didn't have the decency to thank her. - W.C. Fields
 
BeltwayBandit
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 4:06 am

A bankrupt airline with the intention of emerging from bankruptcy MUST operate just like an airline with a future. All those things make sense. As long as the big creditors are happy with the course of the plan, the plan will move forward. At some point, however, if all these efforts seem futile, the creditors will need to step in and pull the plug.
 
AA7573E
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 4:16 am

While I do agree that UA must be aggressive as to their plans for reinventing the airline as it exits bankruptcy, I also agree with the general sentiment that Ted is doomed, and in some sense will hurt United overall.

Simply put, the similarities in the underlying cost structure between United and Ted, means it will be more difficult for Ted to achieve the economic advantages that WN or B6 profit on. The Unions clearly feel misstreaTED, misrepresenTED, and are quite vociferous in expressing their feeling. Furthermore, I'm am far from convinced, as is a large portion of the commercial aviation community, that TED will generate a substantial amount of new business, as opposed to cannibalizing mainline traffic, and moving it to TED for a lower fare, and a yield that is marginally better to the same as mainline. There is only so much utilization you can squeeze out of an airplane before you start to see marginalized returns. TED is operated by UNITED for UNITED, and thusly carries the associated burden of the comparatively bloated cost structure that United has. That's not to say that United has not reduced, over the past 12 months, their cost structure - but it is nowhere near that of an LCC, and it does not provide them with the ability to operate like one.

Unless the underlying structure of TED is addressed, and substantial reductions in operating costs are achieved - above and beyond those achieved through higher utilization rates- TED will fail. SONG is proving it out. Although far from a failure, it is far less of a white knight than Delta expected, and it's future is way up in the air. United has a history of being wagged by the tail. This is yet another example.


See you up front!
 
ual777
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 11:14 am

Well I don't want to speak without backing my facts up so here are the loads for Feb 12, Ted's launch day:

(the time is departure, the first column is seats available, second is seats sold, and thirds is S/As.)

1405
DEN-LAS
8:00 156-157-06 

1407
DEN-LAS
9:49 156-156-05 
1411

DEN-LAS
13:20 156-150-00 

1415
DEN-LAS
15:02 156-155-00 

1417
DEN-LAS
17:30 156-147-08 

1419
DEN-LAS
18:30 156-134-05 

1421
DEN-LAS
20:10 156-119-08 


As you can see TED is running a 93.2% load factor (S/As NOT included).
Hope these facts help show how well TED is doing. Song never had loads this high and this is Feburary, one of the slowest months of the year. I think that Ted will be a money-maker indeed.

Happy Skies TED!!!
It is always darkest before the sun comes up.
 
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airzim
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 11:49 am

Well let's just post the loads and that explains everything. First off, posting loads is quite possibly illegal since only people with access to RES have access to that information.

Secondly, you could charge $5 bucks and fill the plane 100% so your information is useless.

Thirdly, Ted is falling right in line with the other "airline within an airline" concepts of failure. Let me first state that Comair etc., is not a fair comparison although they are in the "Delta" family they are a totally seperate company. Comair pilots are paid far less than the collegues at DL, they have a seperate management team, HQ, etc.

Ted is UA Light. Why are the using the same inventory system as UA? Other low cost airlines use systems like Navitaire and the system at Spirit (which I can't remember the name) for a fraction of the cost of mainframe. Even if the want to distribute in the GDS's this is still much cheaper. Strike one from day one.

It is all about cost. Denver is one of the most expensive airports in the US to operate. Strike two.

Product differentiation. Is Ted going to compete against UA in some markets? Yes. Are they going to screw the consumer who thinks he/she is getting one thing and not another? Yes. Strike three. The consumer is not smart enough or cares enough to tell the difference between one flight or the other. Classic CO Lite mistake.

Name one airline where it has been successful? Can't because there aren't any. With one exception, GO. The difference with GO is it was totally seperate from BA. Different RES system, different airports, different markets, no link to FFP, different pilot and FA base. It was different. Ted is not different.
 
akjetBlue
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 11:52 am

How is posting loads illegal? Couldnt you just go to the airport and count the poeple as they board? How idiotic...illegal!
Save a horse! Ride a Cowboy!
 
ual777
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 1:22 pm

Airzim: With all due respect, your analysis is flawed in a number of ways.

First off, I did NOT get my info from the RES computer. Secondly, I do not think that UA would care all that much and if they do, I will gladly apologize and not do it again. I was merely providing a sample of Ted to show it is not a failure.

Secondly, UA is not and NEVER will have $5 fares. Do you honestly think that the people in UA's pricing department are so daft as to price fares so that they cannot make money? They are competitvly priced and designed to make money.

Thirdly, Ted is NOT UA light!!! CO lite was a completely diff. product. They offered NO food, had no galley, and flew to places people did NOT want to go.(Source: From Worst to First by GORDON BETHUNE) In addition, UA is using the same inventory because it SAVES money by integrating Ted into the reservations system. Not only does Ted serve leasure markets, but it can also be used to connect to mainline UA flights, hence why it is flying out of DEN and shortly IAD.

As far as "screwing the consumer" for getting a different product, why don't you look at the airplane. It says PART OF UNITED. From day 1, UA has told the consumer that Ted was merely a "portfolio expansion." It is designed to be pleasure traveler friendly. It is different from mainline UA(and CO Lite) in a number of areas:

1. Ted offers significantly lower fares that suit the leisure traveler without sacrificing good service.

2. Ted is more laid back providing entertainment that a family or couple on vacation can enjoy on the way to their destination.

3. Travelers on Ted can redeem FFMs for later vacations which increases UA's intent to repurchase.

4. Ted offers CHOICE. Travelers will have the ability to purchase food on-board or just stick with the compliamentary beverages and peanuts and save money.

5. Ted shares all of its basics such as interior seats, parts, reservations, pilots, FAs, dispatchers, and other personnel with UA. This not only saves money by not buying additional resources and having to mantain them; it also allows UA to flawlessly integrate the travel experiance for it's customers.

I believe that once in a while a company makes a dramatic shift that proves that industry trends can be beat. In the 70s till now, that trendsetter has been WN. UA has had the oppertunity to review all the "airline within an airline" mistakes and misfires and has created a plan that is economically viable to the company and friendly to the passenger. UA now not only appeals to the business traveler. It has created a product for the average Joe(or Ted in this case) and will be successful. Costs are lower, loads are higher. UA is on the right track with this one.

In closing, just because the success rate has been low in this particular endeavor doesn't mean it can't be done. MANY LCC upstarts had failed before WN came along. UA has watched, listened, lowered costs, and studied what would make this idea work. Now they are implementing it. Please do not make generalizations without backing them up.


2 days to go till its "TedTime"!
It is always darkest before the sun comes up.
 
SHUPirate1
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 1:35 pm

UAL777-Any way of knowing how many of those passengers on those flights are O&D and how many are connecting...additionally, could you please check UA 1500 (TED) LAS-SFO on 4/12 (the second leg is SFO-JFK on a widebody, can't remember the flight number)...I always wonder about loads on the flights that I am on, because, quite frankly, I am a VDB-compensation freak...
Burma's constitutional referendum options: A. Yes, B. Go to Insein Prison!
 
ual777
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 1:52 pm

SHU, right now its only booked to about 35, but so were the ones leaving Thursday about 2 months ago. Remind me about a week or 2 till departure and I will update you.

As far as O&D, I can't say, but I would venture it is pretty high due to the extensive marketing at DEN, but I cannot say for sure. Perhaps UA744Flagship will come on and make a statement. He knows more about that kind of stuff than I do.
It is always darkest before the sun comes up.
 
UA744Flagship
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 2:31 pm

Hi UAL777, unfortunately I don't know what proportion are O+D v. connecting pax.

I can tell you the average fare is pretty good  Smile, but I have no idea about the connecting pax figure.  Sad
no wire hangers!
 
alphascan
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 5:37 pm

Do you honestly think that the people in UA's pricing department are so daft as to price fares so that they cannot make money?

ROFL
"To he who only has a hammer in his toolbelt, every problem looks like a nail."
 
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airzim
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RE: UA/Bankruptcy Ironies

Tue Feb 10, 2004 9:02 pm

Let me try and repeat this again since you seem to not get it.

First off, airlines consider booking information confidential. Loads indicate how many seats are left on a given flight and a competitor could take that information and use it to their advantage, e.g., shut down lower buckets because it knows UA is sold out for example. Whether UA cares or not this information is not readibly available to the public, no travel agent has this information so I would highly recommend not posting it, but I could care less if you got in trouble.

Secondly, my $5 reference was an example. I didn't say that they were charging $5, I was stating that loads indicate absolutlely nothing on profitability. The statement was, you could charge $1 and fill the bird and have 100% load factor, but lose your shirt. Posting the loads show neither success or revenue potential on the flight.

Do I honestly think that people in UA's pricing department are so daft to price fares so that they cannot make money? Do you really want me to answer that? If UA were pricing their flights to make money they wouldn't have lost $2.4 billion last year. So tell me how they intend to price these flights under their current rates with the same essential costs and make money? I'd love to hear it.

Lastly, the remainder of your e-mail talks about nothing. Good feelings and high expectations are nice, but the numbers just don't add up. How the hell does using Apollo for Ted going to save money? You could do the same thing with a cheaper RES system at Ted for about $30 less a transaction fee per booking. CO, Tango, MetroJet etc all had different logos outside the plane, they tried to tell the consumer they were different products. Didn't work. Nothing else in your e-mail discussing anything different from what the others have tried.

Look you can call it what you want, but if you use the same crews, with the same salaries, with the same cost structure, but with lower fares, TED will be the "end of United"
 
UALPHLCS
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RE: UA/Bankruptcy Ironies

Wed Feb 11, 2004 3:02 am

Gee if reporting traffic is illegal I guess All that traffic information the airlines report after the fact is illegal too.

This ia a weak argument to make Airzim. You 're predicting Ted will be a failure, simply because the previous "airline with in an airline" concepts sisn;t work.

1) UA Shuttle was closed, not allowed to fail. It was closed for a number of reasons not the least of which was the retirement of all of UA's 727 and 737-200 fleets. This left a very big whole to fill on the east coast where the Shuttle 737's did not fly. Take a look at all the cities that have old Shuttle planes at them now. PHL is just one example.
2) Shuttle was MAKING MONEY for UA. It was profitable in the last 6 months of existance. It was closed by the shortsightedness of the CEO, Jim Goodwin. In his panic to save UAL from the disaster of his own making, he threw the proverbial baby out with the bath water. The guy just said and did things without thinking them through. Tilton looked at Shuttle from the very first said that closing it was a mistake. Concievably had Tilton been CEO in Fall 2001, Shuttle would still be around and we would be talking about its "rebranding."
3) I don't know were you get know numbers but changing res systems for Ted is just stupid. All of the UA people would have to be retrained RSA and CSA's new comptersystems would have to be put in place, and new software would have to be serviced. When all UA wants to do is simplify the fare structure. TED's fare model is obviously the simplified model UA wants to move toward. All airline CEO's say that the current price structuring is complicated and confusing requiring lots of rules to learn and train people on, and it doesn't help the customer. But no airline want to be the first to change. Well UA has made the first innovative move with TED. Its up to the other carriers to start to simplify now as well.
4) Ted is a higher volume carrier than mainline. The planes carry more people and will fly more segments per day. Ergo, those planes make more money.
5) The loads for Ted are relevant because other LC operations like SONG did not and continue to have lower than exspected loads. So when UAL777 goes and quantified the sucess UA is having with TED, just dismissing the numbers as irrelevant doesnt work.
A little less Hooah, and a little more Dooah.
 
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airzim
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RE: UA/Bankruptcy Ironies

Wed Feb 11, 2004 8:44 am

UALPHLCS,

You really are blinded by your ignorance. Read very carefully again why you are not allowed to post BOOKED LOADS ON A FLIGHT PRIOR TO DEPARTURE. It's not worth explaining to someone who clearly doesn't care to understand.

I'm not going to comment on UA Shuttle profitability or not. Reagardless in today's environment it would be unprofitable and likely not flying. This isn't rocket science. Its all about costs. If you fly the same high fixed cost planes, with high cost salaried empolyees, regardless of utilization because of union on government work rules the product will not make money.

On point three, RES is a significant cost in the booking equation. UA hasn't changed that, where's the savings when you continue to use Apollo. Even better if there are more paxs per segment then you booking fees will only increase. Training airport staff on new systems isn't that hard. Just ask Qantas because that is what they are doing with Jetstar. In fact the Navitaire systems are even easier to use in some cases than the legacy mainframe systems. The booking fees per segment from the major RES system is pushing something like $.25 per segment. With Navitaire it is 1/4 of that fee. You do the math.

4) Not going to even answer this one. Re-read this and why don't you tell me what is wrong with your statement. Lower yields with high volume does not mean necessarily higher revenues. Regardless of more segments or more passengers your cost base hasn't changed. Sorry not buying it.

5) "Quantified the success UA is having with TED" Are you serious? They changed the business model and fare structure several times and they haven't even started yet. What success are you refering to?

I will say this one more time for the less educated, LOADS INDICATE NOTHING ABOUT REVENUE OR PROFITABILITY. Comparing Songs loads with TED's bookings is like comparing apples and oranges. All the same arguments for UA's failure with this are the same I would make with Song. The reason SONG is failing is their pilots are still flying the same planes with the same salary. Two biggest airline expenses, fuel and salaries. Where has UA significantly impacted either of these areas. If they have I can't see it.
 
ual777
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RE: UA/Bankruptcy Ironies

Wed Feb 11, 2004 10:24 am

Uh, airzim, you really need to read up on UA in order to discuss them. Pilots at UA have taken 30% paycuts or MORE to help reorganize the airline. In addition, I believe the FAs and mechanics have done the same so do not say steps haven't been taken when they have.
It is always darkest before the sun comes up.
 
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KaiGywer
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RE: UA/Bankruptcy Ironies

Wed Feb 11, 2004 10:35 am

ail to see how the "airine with in an airline" has been proven dead. Are not Comair and Airlink wholly owned and integrated into the DL and NW system?

Wrong! XJ is independently operated, and has a contract with NW to fly certain planes to certain places at certain times. If they don't live up to expectations, NW can cut the contract within 2 days on Avros and 7 days on SAABs (anybody remember the strike talks, this was a big issue). As far as 9E goes, I believe NW just sold all their shares in 9E, and hence does not own neither XJ nor 9E.
“Once you have tasted flight, you will forever walk the earth with your eyes turned skyward, for there you have been, an
 
UALPHLCS
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RE: UA/Bankruptcy Ironies

Wed Feb 11, 2004 10:56 am

Airzim,

Before calling someone blinded by ignorance, you should look in the mirror.

UA has no problem relating its booking information to nonrev travelers well in advance. The information given in the post we are refering to makes no mention of fares just load factors.
So Airzim if you saw UA was sold out on a flight Airzim airlines would have no problem gouging its customers. Nice way to do buisness, I thought LOW Fare Carriers were the key. But now I see, low fare until the other guy is sold out then stick it to the passenger.

UA and other airlines routinely talk to the media about their advance bookings. While they don't go into specifics, I doubt UA is going to have a fit over a few TED flights numbers being "leaked." In fact they would propably be please that the numbers defend thier decision to launch Ted. So far so good.

You obviously don't understand point three because other than repeating your nonsense you don;t address the issues I raised about changing res systems. I am sure UA has done a cost benefit analysis of changeing from Apollo. What is the cost of the new system plus the new hardware, the new software and the new training of TEN THOUSAND CSR AND RSR's to work the new system. IF the savings were that much better they would do it. OBVIOUSLY, then the savings are not what you IMAGINE. As UA is currently under chapter 11 any change like that would have to have an immediate savings which it just doesn't.

Point four you can't argue with because its true. That's how WN makes its money higher volume and utilization. And you convienently ignore the costs UA HAS cut from its operation as a whole. You make it seem like TED's costs are the same as the MAINLINE in 2001. Plainly not the case.

Point Five said that the numbers that you would rather us not discuss for "competition" reasons ARE VALID in this argument because they show that TED's bookings are full. Full flights make money therefore success. We will see in the long run. But so far Ted has had MORE been more sucessful then SONG.
A little less Hooah, and a little more Dooah.
 
mattnrsa
Posts: 361
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RE: UA/Bankruptcy Ironies

Thu Feb 12, 2004 9:51 am

While I agree with UALPHLCS and all other UA posters regarding the success of TED, it is inappropriate to post specific advance bookings of our flts. Yes, all employees have access to the loads thru the PXCs in Apollo or thru Skynet, but that information is for UA employees only, not meant to be disseminated to the general public. That is why the confidentiality statement is on the sign-in page for Skynet. Nobody else is supposed to have access to it.

But I agree with everything else....GO TED!!!!
 
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airzim
Posts: 1216
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RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 12:18 am

UALPHLCS,

Read Mattnrsa's post. While non-revs on UA have access to that information, it is not readibly available to the general public. Hence my statements. I have signed countless NDA's with airlines and I can assure you that advanced booking information is considererd confidential information.

Beyond that, your statements border on childishness. Statements like "So Airzim if you saw UA was sold out on a flight Airzim airlines would have no problem gouging its customers. Nice way to do buisness, I thought LOW Fare Carriers were the key. But now I see, low fare until the other guy is sold out then stick it to the passenger." That's called revenue management. And although your statement was sarcastic, I actually agree with what you said. Countless simulations and historical models suggest that this is the best way to maximize revenue. If you don't think Southwest the most proclaimed airline today doesn't do what you said above, you better start paying attention.

I have never said nor do I agree that LCC is the proper business model going forward. It's about Low Cost, not Low Fare. There is a difference.


On the RES change you don't get it so I am not wasting my breath. You don't understand nor do you chose to understand. You never criticize anything your precious UA is doing so clearly critical rational thinking is not what your interested in.

On the cost issue, while UA has cut costs you are nowhere near competitive with Frontier, who you are going head to head with. Unless you can compete dollar for dollar your hosed. 30% reduction is across the whole carrier not just TED. Show me where the cost advantage is against the competition UAL777?

I'll say this one more time for your sake. High loads mean nothing. Period. Any airline can fill all their seats with cheap fares, doesn't mean they are making money. PEOPLExpress and Tower Air are good examples of this. Where are they now?


 
UALPHLCS
Posts: 3233
Joined: Thu Jun 28, 2001 5:50 am

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 3:10 am

Airzim,

You use rhetorical phrases like " not wasting my breath" to make it sound like I'm the one who doesn't get it. When clearly, I have stated... TWICE, why changing res systems or having a seperate res system for 10% of an operation is just a waste of money.

Instead of showing that it really is cheaper to retrain tens of thousands of employees, buy new hard and software, all a saving you say exists, you try to belittle the other guy. Try wasting your breath. Because if you can't back up your claims then the first post was a wate of breath to begin with.

Airzim makes the claim that the sky is green, but when you challege him on it, he won't "waste his breath" to explain himself. If he has so little regard for his own arugment that he won't defend it why should be believe it? Just because he says so?

The other rhetorical trick it to try to paint your opponent as a fanatic. No one has ever accused me of being soft on UA management. Go ahead and look at my posts on Jim Goodwin, and Steven Wolf. This company as been run by idiots in the past. I know it just as anyone knows it. Right now though we seem to have a guy who knows what he's doing. He's proven it by the fact that despite what the critics have said UA is flying today. Airliners.net Armchair CEO's have been itching for UA is go belly up, first it was in Feb of 2003 then March then the summer, then winter, well Tilton has proved you all wrong. So I tend to think that he has some information and analysis that Airliner.net folks don't have. And he has made good use of it.

Today Ted starts. From here on out we will see how Ted does for real, not in some hpothetical world that airliners.net users love to live in. I hope Airzim, that unlike those who thought UA was going to be dead by now, you can actually admit it when Ted proves itself. We wait and see.
A little less Hooah, and a little more Dooah.
 
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airzim
Posts: 1216
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RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 5:27 am

Funny thing is you whined on and on about frikin' RES systems, but yet you failed to even mention that you were wrong about posting bookings information. You had no comments on the fact that Ted's costs are still way out of wack against your direct competition, that high loads are meaningless to prove success of failure of a given airline, or that the concept of a stratified pricing structure is the most effective way of increase incremental revenue for an airlines.

Back to the RES side of things. Qantas is splitting off a significant portion of their domestic operations to JetStar. It appears this stage JetStar will have a the secondary market in OZ, long term forecast are for potential up to 30% of the market, maybe even the entire domestic system except the Cityflyer flights in the future.

Recognizing that cost is the real competitive advantage in the Australian market they have look at streamling the fleet to A320's. Sounds familiar doesn't it?

This is where it begins to change. They are completely segmenting off JetStar from QF. It will have a new HQ in MEL, new management with salaries significantly less than QF staff. New pilot and FA pool also at a significantly lower pay grade. They will have their own RES system (not public which one it is yet so I cannot dilvuge that). QF will be codesharing on JetStar, JetStar will be displaying in GDS', although they will encourage web bookings to keep costs down.

In general, varies by airline, the cost per booking in the large mainframe systems is something close to $.25 a segment. For the new web based RES systems the cost is less than half that.

UALPHLCS, you complain about training costs. Although there is additional training, the long term beneftis outweight any short term hits. Using this new RES system it is capable of doing all the same things as the legacy systems for a fraction of the cost. Links between the Apollo and these web systems is almost completed and expected to be available when JetStar begins flying. The need for additional HW and SW is small and comparing the maintenance of a TPF system to a server based one is light years apart.

This is my favourite statement so far, "IF the savings were that much better they would do it. OBVIOUSLY, then the savings are not what you IMAGINE."

The saving are that good. If you don't believe me just ask Qantas, Air Tran, Spirit, Virgin Blue, Virgin Express, JetBlue, etc., why they went with these web based systems?

UA didn't switch because they didn't have the balls to break TED from UA. It's the same airline. Christ the use the airline code. It's the same airline with different products. That's it. The fact that they have lower fares is meaningless because the cost structure is exactly the same as UA. The fact that they added more seats, and more frequency does not make up for the fact that the cost baseline remains the same.

I keep harping, this is a well worn path of failure. CO Lite, MetroJet, Delta Express, increasingly Song, and I would argue UA Shuttle were all failures. As long as you are paying your pilots over $200,000 a year, the flight attendents $40,000 a year, the same inventory system, membership in Star Alliance, interline bags, high cost airports, etc. How is it different from UA? No First Class?

You defend UA management for starting TED, yet you deride them in the next breath as hopeless and incompetent. Spoken like a true union employee.

God help the rest of the airline industry and put UA to bed

[Edited 2004-02-12 21:31:44]
 
NWAFA
Posts: 1843
Joined: Wed Dec 31, 2003 10:30 pm

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 6:10 am

I just think it is so wrong that UAL has been allowed to spend MILLIONS and MILLIONS of dollars all under Bankruptcy. They have spend MILLIONS on

New Uniforms
New GlassWare
New China
Airline with-in Airline
Advertising
Staffing
Now FLOWERS in FC

They are screwing their employees ever day. They do not deserve to survive with usage like that!

Shame on them!
THANK YOU FOR FLYING NORTHWEST AIRLINES, WE TRULY APPRECIATE YOUR BUSINESS!
 
UALPHLCS
Posts: 3233
Joined: Thu Jun 28, 2001 5:50 am

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 7:19 am

NWAFA is a liar.

New Uniforms- No new Uniforms have been designed since the F/A's got theirs redone in EARLY 2001. After 9-11 and Chapter 11 Uniforms were suspended for several months and New replacement uniforms are just now being sent to employees.

New GlassWare
New China These to a just wrong. Ask some one who was on board in F or C class recently. Oh that would be me yesterday. They use the same stuff we have had for years.

Airline with-in Airline Yeah, this costs a load of money. You people can't get this one straight: Either UA just stays the same and NEVR changes and dies, or they attempt something new, and try to save our jobs. So which is it. Do you want UA to Change, as most of you have been bitching about for years. Or does UA remain static and unchanging and dies like PA.

Advertising This one is funny. UA should advertise. Oh No UA must never say a word, until they are successful enough that they Can advertise. If UA was getting enough business to stay afloat with out advertising they wouldn't need advertising. How do companies drum up business? Are we supposed to just whisper in someone's ear? This is moronic.

Staffing What? The Airline HAS A job to do. If we don't have enough people to do it we need to recall laid off staff and hire new staff. UA has been blessed with high load factors and brisk business, until the typical seasonal down turn. But NOW it the time to hire people to get them trained for the busy summer time.

Now FLOWERS in FC This is fiction.

I am of the opinion that NWAFA is a AFA union stooge who is trying to get people worked up over thier disagreement with management over the pension issue. Don't believe a ward of this bull.

As for you Airzim, I haven't forgotten you. I'll get to you're post in my next posting.
A little less Hooah, and a little more Dooah.
 
NWAFA
Posts: 1843
Joined: Wed Dec 31, 2003 10:30 pm

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 7:22 am

UALPHL

Once again you are WRONG!


I even just called my sister who has been a FA for 24 years with UAL and they DID get NEW China and GlassWear UNDER B.K. Fresh Flowers HAVE returned in FC on INTL Flights. Uniforms did change right as they were going into B.K.

As far as AFA comments, you are typical managment at UAL that is CLUELESS to whats going on!
THANK YOU FOR FLYING NORTHWEST AIRLINES, WE TRULY APPRECIATE YOUR BUSINESS!
 
Thrust
Posts: 2585
Joined: Wed Sep 17, 2003 12:17 pm

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 7:25 am

UA is going to emerge from bankruptcy soon. You watch. They are not suicidal by repainting their planes and creating TED.
Fly one thing; Fly it well
 
UALPHLCS
Posts: 3233
Joined: Thu Jun 28, 2001 5:50 am

RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 7:57 am

As far as the posting of bookings are concerned Airzim: I think it's fine. The person who did it doesn't habitually post them. They were only a few flights and there was not enough information released for anyone to make use of it like you said they could. Big deal ten or so flights loads were leaked in a conversation about Ted's success or failure.

In the context that they were used: which was more seats + More segments flown = more money for UA, you just deny that this is the case and complain that the numbers are released. I claim complaining about those numbers is just a distraction from the fact that the person who posted them WAS RIGHT.

WN has only one class of service (more seats per plane) they fly more segments ( 30 min turn time) they make more money. Simple concept coupled with lower cost it is a very good money maker.

You beat this dead horse about the costs UA is going to shell out for Ted and yet you insist that they should shell out MORE money for a new res system. My contention is that right now Apollo works, we know it, it is reliable and it would be more money to change it right now than UA needs to shell out. If after UA exits Chapter 11 and UA needs to do some capital improvements to its RES system THEN UA should change. I don't like Apollo, but Changing Apollo right now would be stupid in the extreme. Why tons of money when the return will not be felt for 2 or 3 years. UA can't wait that long. Any change UA needs to make right now MUST have an immediate effect on the bottom line. I'll give you a positive and a negative example.

UA may be changing its paint scheme, to a simplified easier to maintain scheme. This would have an immediate effect because planes in D check RIGHT NOW would have to be painted in a more expensive scheme. The (supposed) lighter weight will also save fuel. This is a good capital expense.

UA has one of the largest 737 fleets in the world. Installing blended winglets would save money on fuel. But the Costs to buy and install those winglets would be more than the savings for a few years. Wait until UA can afford to make that change.

"You defend UA management for starting TED, yet you deride them in the next breath as hopeless and incompetent. Spoken like a true union employee."

I told you to go see that I have been very critical of UA's management when it was wrong. Let me clue you in to something Airzim: UA's management is not the same as it was under Goodwin or Wolf. We have a new guy. He's been with us for over a year. His name is Tilton. And while I do think that PREVIOUS management under Gangrwal, and Wolf and Goddwin were terrible, Tilton has shown me over the past year that he has what it takes to lead this company. According to Airliners.net people UA should have declared Chapter 7 months ago.

If UA being around bothers you people and you all know who you are, tough. Because WE at UA From the Front office all the way down to CS and the Ramp are happy to disappoint you in this regard.

Lastly, I'll finish with NWAFA:

As far as AFA comments, you are typical managment at UAL that is CLUELESS to whats going on!

Again NWAFA please research your posts, I am NOT management. It says so very plainly in my PROFILE. Just click on my Handle and it will take you there. I have also answered several posts were I made it clear what function I fulfill in PHL. I do NOT spout Union propaganda like a lackey, nor do I give Management a pass as I just finished explaining to Airzim.

If I could I'd give you a dollar to go buy a clue.

[Edited 2004-02-12 23:57:58]
A little less Hooah, and a little more Dooah.
 
User avatar
airzim
Posts: 1216
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RE: UA/Bankruptcy Ironies

Fri Feb 13, 2004 10:40 am

UALPHLCS,

Now we are having a debate. While 10 flights may be no big deal, it is a breech of confidentiality. One is too many. You should be concerned about it, because if a competitor does choose to use it, or any information about UA, it will affect you, not me.

"In the context that they were used: which was more seats + More segments flown = more money for UA, you just deny that this is the case and complain that the numbers are released. I claim complaining about those numbers is just a distraction from the fact that the person who posted them WAS RIGHT."

This I don't agree with. If you fill a seat with someone that paid $100 and the flight is full, and someone out there was willing to pay $110 you just lost $10. Multiplied by every flight, every day, over months and this adds up. Countless simulations and real world examples have proven that this makes the difference between profit and loss.

As for WN, they make money because their costs are in control. In fact the management is not rewarded for revenue increases but cost control. You can afford to charge $99 bucks because they have low costs that includes a great many more things that fast turns and one class cabins. It also includes low distribution costs, no interline, no code-share (OK one but that doesn't count), low cost operating airports, no hubbing, etc. I don't see TED doing any of those things.

Now on Apollo you are finally making some rational arguments against changing. I can agree on some points but the fact still remains, Apollo will kill them. Why do you think airlines are so keen to push things to the internet? Not for the convenience! Nice analogy on the blended winglets. Now I am starting to respect your opinion (not that you care).

As for UA management I'll leave you to it. I think this strategy is going to end the misery sooner rather than later, but the fact that you have faith, good on ya.