The recently posted article about NW
's 1995 decision to refurbish their DC-9 fleet instead of replacing it got me thinking about US Airways' decision to replace their DC-9s with Airbus narrowbodies. I wanted to compare some reasoning for each carrier's reasoning.
I believe US Airways made the right decision for their airline to introduce the Airbus narrowbodies and retire their DC-9s. I think is a big reason they're still around today. Here's why:
1. They've been able to utilize the Airbus narrowbody fleet to new international destinations, where margins are better and low-cost competition less fierce. In 2004, former CEO Dave Siegel mentioned that this service made up a bulk of the Mainline's profitable flying. The DC-9s wouldn't have been able to fly these lucrative routes.
2. Versatility: An airbus narrowbody from a Caribbean destination can refuel and compete just as effectively on a short-haul northeast route, or a transcontinental flight.
3. The Airbus fleet offers improved in-flight features like laptop power at every seat and video entertainment. This is attractive to customers, and helps their product to better compete with their competition, which often has the same new aircraft, often with comparable or better in-flight features.
Now Northwest's decision to refurbish their DC-9 fleet provides some benefits for them, as the article outlined.
1. They own the aircraft, so parking them when demand falls is more cost-effective.
2. The costs to operate the DC-9 fleet are suprisingly competitive.
I think the fleet decision has limited Northwest's options somewhat for growth. Northwest can't grow to Mexico and Caribbean like US and CO
can. They're forced to grow narrowbody destinations domestically, where the competition is more fierce and margins are historically smaller.
While the US decision has provided the aircraft to implement more profitable international flying, those fancy new Airbus planes are very advanced and aren't owned outright.
Has each airline made the right narrowbody choices for their company and network, that gives them the best chance to survive long term?
...carelessness and overconfidence are usually far more dangerous than deliberately accepted risks. - Wilbur Wright