UA744Flagship
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Ted's Performance For United

Fri Dec 17, 2004 12:47 am

***DISCLAIMER***
Understanding of the information within this thread is reserved for readers who can read, write, and interpret business statistics.

The purpose of this post is to show that Ted is simply not "new paint" as many unintelligently assume.

The facts from UAL's latest 8K:
  • United's CASM is 25% higher than the Average LCC CASM, for 2004 Q1-Q3
    * noted CASMs (UA = 9.99, F9 = 8.18, WN = 7.84, B6 = 6.02)
  • Ted averaged an 85% load factor on its 18 routes, outperforming competing LCCs by 6.5 percent.
  • Ted achieved these load factors while earning fare premiums of nearly 20% over its low cost competition.

    Analysis

    1. Ted's CASM itself cannot be 25% higher than the average LCC CASM as United's overall CASM includes all mainline fleet types, particularly widebodies, that have higher CASMs on an equivalent route. One would expect it to be significantly lower than 9.99 as Ted utilizes efficient A320s in an all-coach configuration with the same amount of seats as a jetBlue A320.

    2. A combination of a 6.5 percent load factor premium with a nearly 20% fare premium suggests a RASM/PRASM premium of around 20%.


    Now I leave it to the intelligent readers to give their input on these figures and analysis. Keep in mind, unintelligent readers, that these numbers are not "cooking the books" as this is in a report given to the SEC - not an internal report.

    It's my opinion that while these figures aren't exactly proof positive on Ted making a profit for UA - it's clear and OBVIOUS that Ted is doing a much better job tha UA mainline could in competing against LCCs on its 18 leisure-oriented routes.
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    MaverickM11
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:11 am

    "Ted is simply not "new paint" as many unintelligently assume.
    "

    But it is. It's UA economy repackaged as Ted--at least Song tried to differentiate the actual onboard product. Why not fix the mainline product rather than developing something entirely new that, in reality, isn't new at all. Ted should be a fare bucket(s) on UA mainline; it would get the same results minus the costs of the whole rebrand.
    E pur si muove -Galileo
     
    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:23 am

    No, it would not. The reason for sub-branding Ted was two-fold:
  • To deal with the perception that United is high-fare airline, that it never has lower fares than the LCCs
  • To protect United's image as a carrier that offers F class, elite flyer benefits, etc.

    If you simply made Ted fare buckets, which at first glance makes sense, you would still have a higher CASM (less seats... try 144 versus 156), plus arguably less traffic.

    The simple fact that Ted has been pitched and introduced to the world as a LCC from the get-go gets more people in Ted planes than if UA were to simply say, hey, we've got low fares now. After all, United does not pitch its master brand as an LCC - it's got mainline, it's got international, heck it's even got that crap Express product.  Smile But with Ted, the message is clear. Low fares. Rational prices all the time. Just like the LCCs.

    And for the thousandth time, the Ted rebranding costs were minimal (UA did not approach it like Song, Ted is still pitched as a part of United) and hailied and respected in marketing/branding publications.

    Ted is essentially an aircraft reconfiguration, but combined with a very cheap, yet extremely effective, rebranding to the consumer. Why spend the $$$ to rebrand? Because the costs are minimal in comparison to the increased traffic Ted gets simply for being a new LCC on the block. People generally like it when new, simple, lower price alternatives pop up on the market.

    [Edited 2004-12-16 17:27:53]
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    BlatantEcho
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:29 am

    What % of the seats from that 85% load factor would have flown UA Mainline anyway. I think that's the only question worth asking at this point.
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:35 am

    To say that's the only question worth asking at this point is extremely shallow.

    But to answer your question, Ted has stimulated traffic in its markets and has increased market share, while increasing load factors and frequency, in its markets compared to when mainline ran the routes.

    And people, you can't raise the argument: "Why doesn't United just fix its whole mainline product." Do you know how costly that would be for a carrier with 450+ planes to do? United can't just eliminate First Class on ALL its routes, not only would that alienate customers, it would cost $$$ to reconfigure ALL the aircraft.

    Instead, a much more cost efficent way to combat LCCs where you are being hurt the most by them is to simply mimick their seating configurations and value propositions, even if *shock* they are eerily similar to mainline coach, but only on the routes where it makes sense.

    To be sure, I think that United has more markets it should convert to Ted, but that is a different story.
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    MaverickM11
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:38 am

    "Ted has stimulated traffic in its markets "

    Not really; the capacity in just about all Ted markets is the same or down after the conversion from UA mainline. For instance they would replace a 752 with an A320 to PHX.

    ""Why doesn't United just fix its whole mainline product." Do you know how costly that would be for a carrier with 450+ planes to do? United can't just eliminate First Class on ALL its routes, not only would that alienate customers, it would cost $$$ to reconfigure ALL the aircraft"

    If Ted is doing so well, as you state, then reconfiguring the entire UA fleet, though costly, would provide a significant return on their investment. I could get behind that. But what good does reconfiguring a tiny percentage of the fleet do?
    E pur si muove -Galileo
     
    ord
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:47 am

    "But what good does reconfiguring a tiny percentage of the fleet do?"

    It works because it is targeting a specific segment. Look at Marriott. Their Courtyard brand works, but all Marriotts will not be converted to Courtyard. Courtyard is used to target a segment of the market that a standard Marriott would not appeal to. Ted is being used in a similar manner.
     
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    PA110
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:49 am

    MaverickM11,

    For instance they would replace a 752 with an A320 to PHX.

    That's not necessarily true. From SFO, UA operated primarily 735 aircraft, with 1 or 2 flights using 320 equipment. There are more seats now in this market.


    It's been swell, but the swelling has gone down.
     
    MaverickM11
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 1:51 am

    "Look at Marriott"

    That was what the AC management team always referenced, but where are Zip and Tango now? UA's problems are much bigger than anything Ted could ever dream of helping to solve, especially with such a small fleet.
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    D950
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 2:21 am

    As a Premier Executive I give UA plenty of miles, very often on a trip of 4-5 legs I end up on TED frequently, the crews are the same, the service difference depends on the experience of the flight attendants. I hope they do well, however they should have eliminated 1-2 rows of coach so that the bulkhead seat does not result in leg cramps, the mainline 320/319's are perfectly spaced. I will continue to support UAL in their struggle to survive, as they have always been good to me!!!!
    Resting on your laurels is a synonym for flirting with disaster
     
    N1120A
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 2:31 am

    >To deal with the perception that United is high-fare airline, that it never has lower fares than the LCCs<

    Yet they often are. Take for example the LAX-MSY-LAX route (the one I fly most often) which is flown by UA mainline and fills both the premium cabin and Y. Not only do the often match or beat WN on the route, but I can often get MSY-LAX-OXR-LAX-MSY for as much or less than WN MSY-LAX-MSY.

    >To protect United's image as a carrier that offers F class, elite flyer benefits, etc.<

    Ted does all the same things UA does

    >however they should have eliminated 1-2 rows of coach so that the bulkhead seat does not result in leg cramps, the mainline 320/319's are perfectly spaced. <

    If they did, they would have the same number of seats as the regular A320s and have no cost advantage. Sorry to say this, but they should have kept Y+ out of the Ted planes and just had an across the board decent seat pitch (Like WN and B6 do).

    BTW, widebodies have a lower seat-mile cost than narrow (exception being the 757 v. 767). The lowest seat-mile plane at UA is the 744, followed by the 772
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    cx750
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 2:42 am

    "One would expect it to be significantly lower than 9.99 as Ted utilizes efficient A320s in an all-coach configuration with the same amount of seats as a jetBlue A320"


    I believe jetBlue has somewhere close to 170 seats vs 156 for Ted. Basically, Ted will lower unit costs...but higher gross weight versions would have been optimum.
     
    ord
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 2:46 am

    JetBlue's A320s have 156 seats.
     
    aa777jr
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 3:21 am

    UA's problems are much bigger than anything Ted could ever dream of helping to solve, especially with such a small fleet.

    This sums up this entire thread...did UA think they'd fool creditors by operating their TED LCC? Going on yr 3 of BK, guess so...

    A liberal is a man who is right most of the time, but he's right too soon.
     
    jacobin777
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 3:33 am

    I really don't fly on United too much (found out I've been shafted on a bunch of FF's miles by them), but it does seem that they have been succeeding in going head-to-head with Frontier and winning that battle somewhat...
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    moman
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 3:38 am

    UAL744:

    Thank you for the figures. I have been trying to see/hear any figures for Ted for months now.

    But I still do not understand how Ted is a LCC. Take this: "The facts from UAL's latest 8K: United's CASM is 25% higher than the Average LCC CASM, for 2004 Q1-Q3 * noted CASMs (UA = 9.99, F9 = 8.18, WN = 7.84, B6 = 6.02)".

    What are Ted's CASM? How would they be considered a LCC, even if they have CASM of 9.0? The might be LCC compared to mainline, but not compared to the "real" LCCs.

    I am also skeptical that Ted is the magic elixir for United. At least they are trying new things.

    Moman
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 3:47 am

    Obviously, Ted is not meant to be the "magic pill" for United's emergence from Bankruptcy. It is just a component of an overall strategy.

    Ted's CASM is not released. Wish it was. But even if the CASM on Ted flights wasn't the LCC average of around ~7.5 cents, the most important point is that consumers embrace Ted as an LCC.

    LCCs get much of their revenue advantage simply because they pitch themselves as the lowest-fare alternatives. The flying public has developed the habit of assuming the LCCs always have the lowest fare, which has been a problem for the major carriers even as they have matched or even beat fares.

    The curious thing about passenger buying behavior is that many will forget looking at the legacies and just opt to buy their tickets at Southwest.com, or jetBlue.com, or AirTran.com. The low fares and fare caps make them feel like they're always getting a better deal, so they are happy with just going to one source and saving time.

    Believe it or not, most of the LCC customers book at the LCC website or hotline, not through a travel agent or online fare search site, like Expedia.
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    bahadir
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 3:56 am

    Ted is a fine product for flights 2-3 hrs. Don't get me started on 5 hr IAD-LAS though.

    During my 6 months SEA-LAS commute I almost exclusively took SEA-SFO-LAS-LAX-SEA routing instead of HP/WN/AS non-stops. Why? Because I like the airline and those segments benefited me. If Ted was all coach with no Econ Plus, my $$$ would vote for one of the 3 alternatives, most likely the home town airline AS.

    Econ Plus is why I am still loyal to UA and I am glad that they are still sticking to it.
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 4:02 am

    The problem with the whole airline-within-an-airline concept is that the track record of these business ventures has been horrific.

    In the US and even in Europe, no legacy-bred LCC has proven its success.

    The problem I see is not in concept, but in execution.

    Tailoring your product to match a dominant market segment has worked in other industries. Good examples: retailing - Banana Republic (high end), GAP (mid range), Old Navy (low end); cars - Lexus (hi end), Toyota (mid range), Scion (low end). There's no reason it shouldn't work in the airlines.

    However, I believe that low-cost/low-fare divisions will only work and should only be implemented if:
  • You don't alienate your existing customers
  • You don't confuse your existing customers
  • You don't have to spend much to tailor your product
  • Your tailored product is competitive with its competition
  • There's not too much of your taillored product

    So far, I think Ted is on the right track. By keeping ties with the United brand (unlike Delta's Song which seeks to be perceived as different altogether) it satisfies *most* of its current customers, and doesn't confuse them by putting the so called "network product" with its volatile fare structure, yet still offering competitive fares, on dominant LCC routes. There's nothing wrong with the Ted product - it's not barebones or unsafe. And Ted is not everywhere United is, because it's not wanted everywhere United is.

    These facts remain:
  • United has only spent money repainting planes and reconfiguring aircraft, and running very cheap marketing campaigns
  • Ted capacity (as measured by seats AND frequency) have gone up in every single Ted market
  • Ted has greater load factors and greater market share than UA did on the 18 Ted routes

    You can't really say the same thing about other legacy-bred LCCs. Song spent a fortune creating a totally new experience and distancing itself from Delta. Song is using aircraft that are too big for its markets (low load factors relative to the LCCs).
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    moman
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 4:20 am

    UAL744:

    "The curious thing about passenger buying behavior is that many will forget looking at the legacies and just opt to buy their tickets at Southwest.com, or jetBlue.com, or AirTran.com. The low fares and fare caps make them feel like they're always getting a better deal, so they are happy with just going to one source and saving time."

    You hit the head on the nail there. I have showed my coworkers/family/friends a couple times how Southwest does not always have the lowest prices. It seems to be ingrained in people's heads that Southwest is always cheapest. I proved to them how AA was the same price or cheaper on quite a few routes.

    Back to topic, you make a lot of excellent posts. And yes, the past is littered with failed "airline-within-a-airline" concepts. Ted seems just like United Express. If this is not so, can you describe how they are different?

    Moman
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    TWFirst
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 4:52 am

    >>To say that's the only question worth asking at this point is extremely shallow.<<


    I disagree. Because this question is in essence the same strategic question United asked itself from the beginning: How do we retain market share at a profitable level against LCC's on given routes where we compete? The way to measure the results of the strategy (i.e. TED) that United is currently executing is to look at TED's market share and yield. If TED is only capturing a very small amount of incremental traffic over what United mainline would have captured without TED, but at lower yield, then the strategy isn't successful.
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 5:12 am

    Moman:

    I assume you are referring to United Shuttle, not United Express. In addition to the obvious differences (no F class, larger & more efficient equipment, nationwide primarily leisure destinations instead of hi-frequency western destinations) Ted is different because of the way it pitches itself. There's not United in front of Ted. To the customers that are familiar with United, yes, they know Ted is literally Part of United. But to the price-conscious consumers, Ted is another new LCC that gives lower fares. Yes, it's hard to think that a difference as subtle as the name can affect consumer behavior, but it does, in conjunction with all the cheap marketing effort Ted has done.

    It's all part of trying to capture more of the leisure segment, and put them in the United system, when they would normally disregard United as a relevant low-fare option.

    TWFirst:

    It seems you are disagreeing just to disagree. The questions you ask are not at all as boiled down as "how many of the customers flying on Ted would have flown on United anyway"? You point out the factor of yield. That was not part of the original question. Note the distinction.

    Well, to answer your query, there are internal UA communications from the summer and spring that continue to say that Ted has actually achieved greater yields, even while increasing capacity. While this has not been externally released, it is what UA is telling its employees. If you do a search of the posts that I've made, you'll see the text of these releases.

    It's not at all unbelievable... hmmm... 20% fare premium over the LCCs in the current markets. Guess what? United's *systemwide* yield is actually lower than Southwest's. If Ted is achieving a 20% fare premium over LCCs in Ted markets, it's easy to deduce that Ted's yields are better than mainline.

    It's quite an interesting paradox - that an LCC fare structure earns a better yield than a legacy. But this is what's happening in many US markets, and why the LCCs are flourishing. In many markets, the extra traffic and increased loyalty stimulated by lower and simpler fares creates more revenue than a wide, unpredictable variety of highly priced and discounted tickets.
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    TWFirst
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 5:20 am

    >>TWFirst:

    It seems you are disagreeing just to disagree. The questions you ask are not at all as boiled down as "how many of the customers flying on Ted would have flown on United anyway"? You point out the factor of yield. That was not part of the original question. Note the distinction.

    Well, to answer your query, there are internal UA communications from the summer and spring that continue to say that Ted has actually achieved greater yields, even while increasing capacity.<<


    Oh yes... that's what I was doing... disagreeing just to disagree because I just love wasting time doing that you know...  Insane

    Jesus, take the chip of your shoulder... if you don't want to have a discussion, then don't post a thread.

    In my mind, the question of yield is always implied in any discussion or question of Legacy/LCC competition, because the whole point of LCC's existence is that their lower overhead costs allows them to charge lower fares and succeed on lower yields. Yes, that doesn't mean that's automatically what happens in a given market, but it is a pretty safe assumption.

    If Ted HAS "actually achieved greater yields, even while increasing capacity".. then awesome! Yippie yay! I wasn't saying they weren't... I was simply saying that the question posed earlier that you poo-pooh'd as "shallow" ISN'T shallow.






    [Edited 2004-12-16 21:33:47]
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 5:25 am

    If you're gonna do a tit-for-tat and pull a drama queen response, the question WAS shallow - there was no mention of yield. Basing Ted's success on traffic stimulation only... that's oversimplifying.

    And I didn't write that you said the yields weren't good, I was just answering your question.

    Take a chill pill.
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    TWFirst
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 5:28 am

    >>I was just answering your question.<<


    But I wasn't asking YOU a question.... I was posing a rhetorical question. And YOU initiated the tit-for-tat buddy. I simply posted my thoughts on the original question posed... it wasn't an attack on you. A bit sensitive, are we?
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 5:33 am

    Not sensitive, just like to call people out on their bullshit.

    "What % of the seats from that 85% load factor would have flown UA Mainline anyway. I think that's the only question worth asking at this point."

    is clearly not the same as

    "How do we retain market share at a profitable level against LCC's on given routes where we compete? The way to measure the results of the strategy (i.e. TED) that United is currently executing is to look at TED's market share and yield. If TED is only capturing a very small amount of incremental traffic over what United mainline would have captured without TED, but at lower yield, then the strategy isn't successful."

    Laid out plain and simple.
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    TWFirst
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 6:23 am

    Now it's my turn to "lay it out plain and simple"

    Please re-read the COMPLETE reposted sentence below:

    Because this question is in essence the same strategic question United asked itself from the beginning: How do we retain market share at a profitable level against LCC's on given routes where we compete?


    Notice the qualifier?

    I believe the poster who posed the "shallow" question, although not implicitly referencing yields, is speaking to the same issue: If TED hasn't captured any more (profitable) traffic than United would have anyway, how can it be deemed a success??

    THE QUESTION IS NOT A PERSONAL ATTACK ON YOU.

    You would do well to separate your personal self worth from the operational strategy and financial performance of United Airlines.


    (Edited for typo)

    [Edited 2004-12-16 22:28:44]
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    moman
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 6:26 am

    Good point, what is the number for incremental traffic that Ted achives over what United would have had anyways?

    Ted is different from United in my opinion only by the lack of first class. The rest seems very similar otherwise.

    My moms husband works for United and was talking about how low the fares were on flyted.com, well I checked and they were like $340 for a flight that Southwest had for $150. (ORD vs. Midway). I also checked for another flight a couple weeks later and Ted was about $40 cheaper than AA. I guess it is hit and miss.

    Moman

    [Edited 2004-12-16 22:28:30]
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    MaverickM11
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 6:35 am

    "What % of the seats from that 85% load factor would have flown UA Mainline anyway. I think that's the only question worth asking at this point.""

    I think that IS just about the only question to ask. If all of them would have flown United anyway, then Ted has no reason for being. I agree that it's doing "well" (in other words losing less money than mainline UA) but I think it was a waste of energy to produce something that has little to no beneficial effect on UA as a whole.
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    FA4UA
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 6:53 am

    UA744 and ORD... if I could I'd resubmit you to my respected users list... oh well.

    I just worked another TED trip over the past 48 hrs. I did Mainline OAK-ORD and then ORD-MCO on TED (then the reverse of this the following day).

    What I saw was straight out of United's textbook! The people sitting in Economy Plus were all suits, 1K's, Million Mile fliers, Star Alliance Gold and Silver. What I saw in regular economy was screaming kids and tourists.

    What I perceived happening during my flights was that the loyal UA fliers got their extra space, those who aren't the most loyal were able to "upgrade" to Economy Plus at check in for $20 (adds up really quick!) and the screaming kids and tourists got their cheap tickets and a half of a can of Pepsi.

    For those cynical about Econ+ on Ted, I offer this:

    We kill three birds with one stone by keeping Economy Plus on TED:
    1. Keep the Premieres happy with more space
    2. Generate added revenue for upgrades at check-in
    3. Able to compete against Jet Blue (B6) in similiar markets since they have added space in part of thier cabins as well. (there's more than one way to get to MCO)

    Even if just 5 people took the $20 "upgrade" option per flight... that makes millions over an entire year! Economy plus is needed.

    Ted isn't sexy, however it is a viable weapon for United to defend our turf in the LCC wars that we see today.

    FA4UA
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 7:11 am

    Yay, TWFirst, you win. Your phallus is bigger than mine, etc. etc.

    If I equated my personal self worth to that of United, I'd have committed suicide by now, lol. I enjoy tracking United, whether it's doing poorly or not (hard to remember the last time they weren't bleeding), and showing how idiotic some people on here are. People just don't like facts or logical arguments on here, do they?

    Since most airliners.dumb users don't like facts, I'll put some more out:

    Let's compare the DOT T-100 data for, SFO-PHX (since that was a Ted route that was brought up) from July 03 (pre-Ted) to July 04 (post-Ted).

    Overall Market
    July 2003: 31967 pax
    July 2004: 37055 pax

    United/Ted Traffic
    July 2003: 10863 pax
    July 2004: 17764 pax

    Hmm... I'd say that's market stimulation *and* increased pax for UA/Ted.

    OMG, numbers, scary!
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    TWFirst
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 7:28 am

    >>Your phallus is bigger than mine, etc. etc.<<

    That fact was never in question.


    And your numbers are great and support your points.... something I never questioned. I'm happy for TED. Yay for TED.
    An unexamined life isn't worth living.
     
    OH-LGA
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 10:15 am

    heck it's even got that crap Express product.  Smile

    That's a cute comment - coming from someone who worked for an Express carrier for a short time...

    Ted is consistently full when I look at it - especially SFO-LAS routes... while HP seem to always have seats (and thus an excellent backup plan for non-revvers  Smile)

    Kai
    Head in the clouds... yet feet planted firmly on the ground.
     
    planespotting
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 11:03 am

    that is a lot of airlines niche.....back up for ID 90 and non reving airline employees  Smile  Smile  Smile
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 11:32 am

    The Express product in ORD and IAD leaves a lot to be desires vis-a-vis the western, SkyWest-dominated stations. Don't worry, I'm still proud to have been a part of SkyWest, and it's a very well respected name on the resume.

    Oh, and here's a chart I did up with Ted's YOY performance for the latest month we have T100 data, September.

    no wire hangers!
     
    N1120A
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 11:50 am

    >Yes, but if you *noticed* I put "on an equivalent route". Widebodies only have lower CASMs when stage lengths goes up, and narrowbodies are unable to compete as they don't have the range.<

    Hence why they operate high frequencies along routes in Japan all the time and why they took over medium hauls all over the world until things like the 757 and 767 came and then 737s/A320s with real range came along. If you fill a widebody, its CASM is lower, period
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 2:43 pm

    Not necessarily. Those widebodies used on short sectors are in high-density configuration. UA's widebodies, with the exception of the 22 high density 763s and 777s, are in a relatively low-density configuration.

    Most of UA's widebodies would not have a lower CASM than a UA 320/757 on a 3 hr route, or a midcon.
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    AeroWesty
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 10:54 pm

    Regarding the chart posted in reply #34 - is that to mean UA carried zero passengers even on mainline connecting routes DEN-FLL and IAD-FLL in September 2003?

    And out of curiosity, a number of different market analysis reports I've seen from the government have shown average fares and how they've increased/decreased in the comparable periods. I didn't see that in the chart, or in any of the information from the replies in this thread.

    It's great that more seats are being filled, it's great that markets are being stimulated, it's great that passengers seem to be happy with the product, but telling me that United can charge 20% more than an LCC on the same route doesn't tell me if United is better off with the Ted product if fares have fallen to where they would be making less money than under the former model. I remain unconvinced.

    Upfront, I have to say based only what I've read in this thread I think Ted would be dead by now if it weren't for Economy Plus.

    Cheers  Smile
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    UA744Flagship
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    RE: Ted's Performance For United

    Fri Dec 17, 2004 11:14 pm

    Aerowesty,

    DEN-FLL and IAD-FLL are routes UA never served before (with mainline equipment).

    The only proof to tip your belief is United issuing internal communications during the summer stating that Ted has improved yields relative to when mainline ran the routes.

    Highly doubtful that "United's word" would be believable to skeptics though. I believe it, but I'm biased of course.  Big grin
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    AeroWesty
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 12:05 am

    UA744 -

    Highly doubtful that "United's word" would be believable to skeptics though.

    That's why I asked my questions in the manner that I did.  Smile

    But to fully address the scope of my questions, if UA flew ORD-FLL in Sept/03, they certainly sold at least one ticket DEN-FLL via ORD, and that would be tracked in the government figures.

    As a critique, not a criticism, it would make your analysis more convincing to show the full scope of the market figures, which are publically available.

    I say this from a historical perspective, recalling that a troubled TWA started to tout high load factors in the early 1990s, and everyone was bouyant on a renewed TWA, until the fateful weekend Barron's went through their costs and published an analysis that each and every flight would have to fly 96% full to break even.

    That's just one reason I'm rarely convinced on passenger numbers or percentages not backed up by at least a dollar figure on how the route itself is performing overall on a price per ticket basis for every carrier as a baseline.

    I hope you understand my tempered outlook, that in no way should be taken as an anti-UA position whatsoever.

    Cheers, AeroWesty
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    UA744Flagship
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 12:10 am

    Aerowesty, thanks for an insightful post. I do see what you're saying. Unfortuntely, UA is being very secretive about Ted's financial performance, which could be by design, or because of fear. I'm more the optimist.

    As for the DOT T100s from which I got my data, they only show *on-segment* pax traffic only. I don't know how get the data where it shows 1-stop or 2-stop traffic. If you know, please tell me how!
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    D950
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 12:28 am

    I used to fly UAL into MIA very often, watching service go from 757's to 735's over time and eventually to near zero. My question to the UA people, why did TED choose FLL expansion rather than bring TED into MIA?? It seems they may have utilized gates they already had there, rather than FLL. Also, If I am UAL, I may want to be (MIA) where all the other guy's are not. Or am I crazy(no response needed)
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    AeroWesty
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 12:39 am

    I don't know how get the data where it shows 1-stop or 2-stop traffic. If you know, please tell me how!

    I hope you have a lot of disk space and either Excel or a database program to read it, but you asked and you shall receive, my good man  Smile

    Data Library: Aviation

    (To vet myself, I am one of those evil doers who regularly arbitraged airline stocks and bonds professionally, so it was important for me to know these numbers better than the people who ran the companies sometimes  Big grin

    Enjoy and cheers!

    -AeroWesty
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    ord
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 5:44 am

    "DEN-FLL and IAD-FLL are routes UA never served before (with mainline equipment)."

    I'm fairly certain United operated mainline equipment in the early-mid 1990s IAD-FLL.
     
    hiflyer
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 6:07 am

    Username: D950
    I used to fly UAL into MIA very often, watching service go from 757's to 735's over time and eventually to near zero. My question to the UA people, why did TED choose FLL expansion rather than bring TED into MIA??


    Airline costs at MIA have been reported in the local press to be at least 3x the costs at FLL for facility use. UA is just one of a group of carriers that have reduced at MIA in favor of FLL. AirTran and ATA were the two LCC's at MIA and ATA has announced they are pulling out under their Chapt 11 reorg with SouthWest.
     
    D950
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    RE: Ted's Performance For United

    Sat Dec 18, 2004 6:14 am

    Thanks Hiflyer, did not realize that much of a difference was involved. I guess I will ride the 735's till they drop, and switch to AA out of LGA.
    Resting on your laurels is a synonym for flirting with disaster

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