alexinwa
Posts: 867
Joined: Fri Sep 29, 2000 2:08 pm

Why Did National Fail?

Fri Jul 09, 2004 2:13 am

Starting out of Vegas sounded like it should of been a sure bet.

What happen? Wrong A/C with the 757? Wrong cities? Costs to high?

I flew them once SEA-LAS-SEA and the SEA-LAS portion was only about 40% full. LAS-SEA was 100%.

Any ideas?
You mad Bro???
 
desertjets
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RE: Why Did National Fail?

Fri Jul 09, 2004 2:50 am

I am pulling all of this out of my ass, BUT...

I think two factors were against National, despite having strong backing from a few big casino people... I believe Harrah's was an investor in National.

But for one the choice of Las Vegas as a base likely pushed their yields lower. With lower yields, it is obviously more difficult to make a profit.

Secondly the 757 was likely too much of an aircraft for many of the routes they flew. A 757 made sense for LAS-JFK, but not for LAS-SFO or anything else on the west coast for that matter. They would have needed a smaller second aircraft type to operate their shorter flights, but that would have added cost.
Stop drop and roll will not save you in hell. --- seen on a church marque in rural Virginia
 
ConcordeBoy
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RE: Why Did National Fail?

Fri Jul 09, 2004 3:00 am

Starting out of Vegas sounded like it should of been a sure bet

...for failure.
Faire du ciel le plus bel endroit de la terre c'est impossible sans Concorde!
 
dutchjet
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RE: Why Did National Fail?

Fri Jul 09, 2004 3:29 am

ConcordeBoy is right, Las Vegas is an extemely difficult market......there is no problem with filing up flights, the problem is yeilds. Las Vegas is a very leisure oriented destination, and the yeilds are quite low, so it is very difficult for airlines to make a profit on routes to Las Vegas.

National was founded with the backing of several large casino operators in order to increase service in and out of LAS.....the megahotels in Las Vegas were concerned that there was not enough air traffic and seats in and out of LAS and that many of the large US airlines had cut back service into LAS due to the low yeilds. The fact that Southwest has a large operation in/out of LAS also does not help yeilds.....thus National was born with a hub at LAS as Las Vegas' hometown airline.

National closed down mainly because some of its backers did not want to make further investments in funding the airline which was losing money. Flights were filled but at rather low fares. National operated with only one fleet type, the 757, which made sense on routes to New York and Chicago but was a lot of aircraft to fly on routes from LAS to LAX and SFO - rumor had it that National was looking to add a smaller type to its fleet, but time ran out. And, the events of 9/11 certainly did not help National, as air traffic and fares dropped drastically after that terrible day.
 
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clickhappy
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RE: Why Did National Fail?

Fri Jul 09, 2004 3:35 am

N7 had great service, I miss them. It was too bad they couldn't make it work.


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srbmod
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RE: Why Did National Fail?

Fri Jul 09, 2004 6:27 am

One of the things that pushed N7 into CH. 11 back in 2000 was the rise in fuel prices. When your already losing money, any hike in your expenses make it harder to get back above water. 9/11 really did put a fork into National because the casinos backing the airline got hit hard post 9/11 much like the airline industry did. At the time of 9/11, National had been in CH. 11 for nearly a year. Many Las Vegas casinos saw a major dropoff in visitors and considering most of the visitors to Vegas come via airplane, the drop in tourist traffic at the casinos mirrored the drop in air travel. The casinos, much like the airline industry, laid off employees. Many casinos replaced some of their table games with additional machine gaming, and took a cue from the airline industry and rolled out self check in/checkout.
 
ConcordeBoy
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RE: Why Did National Fail?

Fri Jul 09, 2004 7:09 am

N7 had great service

Not to mention a kick-ass livery... even for being predominantly white
Faire du ciel le plus bel endroit de la terre c'est impossible sans Concorde!
 
warren747sp
Posts: 981
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RE: Why Did National Fail?

Fri Jul 09, 2004 7:59 am

N7 was a great airline. They had so much room in economy class compared with the cheap fare they were charging. It was a great bargain even in first class.
However, I still have a return ticket from Vegas to Miami, Oh well!
747SP
 
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yyz717
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RE: Why Did National Fail?

Fri Jul 09, 2004 8:00 am

The 752 is a ludicrously large aircraft for a startup carrier. Low yield LAS as a base did not help.

I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
northwest 777
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RE: Why Did National Fail?

Fri Jul 09, 2004 8:25 am

Are their any interior shots from thier planes?
 
B747-437B
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RE: Why Did National Fail?

Fri Jul 09, 2004 9:47 am

A wonderful and frank discussion about National's problems can be found in this thread from 2 years ago.

http://www.airliners.net/discussions/general_aviation/read.main/915220/

The key difference between National and other carriers is that whereas other carriers took the initiative to modify their business plans to transform themselves (or at least attempt to transform themselves) into financially viable entities, National continued to head the wrong way down a one-way street. They made a mockery out of the free market by becoming the least common denominator in the markets they competed, but operating revenue-negative subsidized by their unsecured creditors and the US taxpayer. Even Pavlov's dog learned his lesson after getting burned a few times. Sadly, National's management didn't seem to.

The industry is better off without them.

"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada
 
texdravid
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RE: Why Did National Fail?

Fri Jul 09, 2004 9:50 am

What happened to National's 757's?
Tort reform now. Throw lawyers in jail later.
 
B747-437B
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RE: Why Did National Fail?

Fri Jul 09, 2004 9:57 am

What happened to National's 757's?

They were all leased to begin with, so they were repo'd.
"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada
 
JetMechMD80
Posts: 370
Joined: Fri Jul 09, 2004 2:27 pm

RE: Why Did National Fail?

Fri Jul 09, 2004 3:09 pm

I think most people are missing the boat when it come to why National went bust. It was a number of reasons,
1. People have come to expect to fly for the same price as a bus ticket.
2. There was a LOT of waste in the company.
3. There was way too much overhead. 14 VPs? Car Allowances, Country Club memberships paid by the company? Just a few examples.
4. The mentality of management when faced with the fact that they were losing money, was not "what can we do to change this" it was "looks like we need to go out and find some more cash.
5. And last but not least, our tax dollars were loaned to AM West and they took the money, and used it to undercut us. Never have figured out how they are vital to US civil aviation, but United is not, wish someone on the ATSB would explain that to me.

Just my 2 cents

"I get along great with nobody"~ Billy Idol
 
elwood64151
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RE: Why Did National Fail?

Sat Jul 10, 2004 2:47 am

And last but not least, our tax dollars were loaned to AM West and they took the money, and used it to undercut us. Never have figured out how they are vital to US civil aviation, but United is not, wish someone on the ATSB would explain that to me.

When HP got its loan, it was fairly soon after 9/11. UA's loan was processed later, after the higher-ups in D.C. decided it wasn't politically expedient to give out loan guarantees (the same thing 'pedoed NJ's loan app in July 2002).

As for why N7 failed, I believe it was a multitude of factors, not the least of which was the low-yeild routes to be had out of LAS. I think they might have had a better chance if they'd operated a smaller type as some have mentioned, say a 737 instead of the 757. I think the 757s were a status symbol to the owners, the largest fleet type for any LCC in the US.

Does anyone have a copy of N7s schedule? I'd be curious to see what their utilization efficiencies were...
Those who fail to learn history are doomed to repeat it in summer school.
 
desertjets
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RE: Why Did National Fail?

Sat Jul 10, 2004 2:59 am

Weren't some former America West execs, pre-Ch11 days, running National. Conway and Beauvais ring a bell. Those folks did a pretty stellar job over extending and over expanding America West in the 80s, it wasn't like they would have done a much better job with National.
Stop drop and roll will not save you in hell. --- seen on a church marque in rural Virginia
 
SegmentKing
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RE: Why Did National Fail?

Sat Jul 10, 2004 4:11 am

Ed Beauvis (sp?) was never involved with national as an officer of the company.. although I believe he's tinkering with Northern Air, whatever they're doing out of SYR or ROC...

-n
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srbmod
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RE: Why Did National Fail?

Sat Jul 10, 2004 5:26 am

The only copy of the schedule I could find online was the one that was effective 5/1/00: