I have been a lurker for about 4 years now, and I think I am going to try to get a little bit more involved in this very informative website. Thanks for 4 great years!
We have all heard about the difficulties that the legacies are facing, specifically on the increasing competition that they are facing on domestic routes in their proper countries. I have often thought, do you think if a legacy carrier spun off its domestic networks(granted, realistically, this would NEVER work with labor groups, emp. morale) into an "LCC" with a lower cost structure and still feed its high-yield international routes, could it make a profit? Flying is becoming increasingly a commodity in the United States, and passengers are becoming more and more willing and adapted to "no-frills" flying domestically. Even now, the traditional high-yield, business markets like LAX-JFK, airlines are filling up their planes showing the passenger demand for low-fares is paramount over anything else.
In other words, how come and airline like United doesn't reshape its ENTIRE domestic network into Ted, let's say, bring low fares and a low cost-structure to that segment, yet still have a traditional cost-structure for the long-haul, high-yield international markets. Granted, I fully realize, that this change could only be gradual and would not work realistically with labor groups, however.
It appears that Virgin could be hinting at this type of a business model by creating low-cost domestic operations (Virgin Blue, America, etc) in order to "feed"(that is debatable, I guess...) it's lavish Virgin Atlantic operation.
Long-haul international markets are an extremely touchy area for LCC's, because it is still in doubt if customers will go without "frills" for 6+ hours in addition to it being a viable environment fare-structure-wise.