SWALoveField
Topic Author
Posts: 151
Joined: Mon Jan 10, 2005 2:49 pm

WN Q3 Profit Doubles

Thu Oct 20, 2005 11:05 pm

 
wingman
Posts: 2769
Joined: Thu May 27, 1999 4:25 am

RE: WN Q3 Profit Doubles

Thu Oct 20, 2005 11:39 pm

The thing about this airline is that it makes a tidy profit even without the hedging, that is just astonishing. Now all we need are LCC 787's and 350's plying the vacation routes and Europe. It'd be nice to fly Jetblue or Southwest to Hawaii and Europe.
 
Fly764
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RE: WN Q3 Profit Doubles

Thu Oct 20, 2005 11:49 pm

So even without the hedges they would still be doing great!  Big grin
 
cloudy
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RE: WN Q3 Profit Doubles

Thu Oct 20, 2005 11:53 pm

Quoting Wingman (Reply 1):
The thing about this airline is that it makes a tidy profit even without the hedging, that is just astonishing. Now all we need are LCC 787's and 350's plying the vacation routes and Europe. It'd be nice to fly Jetblue or Southwest to Hawaii and Europe.

The things that give Southwest such low costs - quick turns, high utilization of aircraft and employees, simplified operations, no alliances, etc. tend not to work as well on overseas routes. Also, fares are about as low as they can economically go for coach international travel. There is not nearly as much opportunity to stimulate traffic while still making money. There are many other threads you can look at if you need more info.

We may see successful intercontinental airlines that use fundamentally different business models. But they will not be LCC's in the same sense that Jetblue and Southwest are, even if they link up with domestic LCC's in some way. This is not a matter of just buying another aircraft type and flying it over the Atlantic. Its a fundamentally different market.

We probably will, however, see more US LCC's flying to smaller US cities with the new Embraer jets. We will also see an expansion of LCC flying between the US, the Carribean, and the rest of North America.
 
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yyz717
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RE: WN Q3 Profit Doubles

Fri Oct 21, 2005 9:14 am

Quoting Cloudy (Reply 3):
The things that give Southwest such low costs - quick turns, high utilization of aircraft and employees, simplified operations, no alliances, etc. tend not to work as well on overseas routes.

How do you know? Just because no one's done it? Before WN came along, I'm sure the prevailing attitude was that a one-service one-aircraft type fleet could not make money....

Quoting Cloudy (Reply 3):
Also, fares are about as low as they can economically go for coach international travel. There is not nearly as much opportunity to stimulate traffic while still making money.

Not true. Many, many counter-examples.

Quoting Cloudy (Reply 3):
This is not a matter of just buying another aircraft type and flying it over the Atlantic. Its a fundamentally different market.

No, it's not fundamentally different. It's actually remarkably similar. Carrying people from A to B and keeping costs low.

One day an LCC will indeed storm the Atlantic. It's just a matter of time.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
DfwRevolution
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RE: WN Q3 Profit Doubles

Fri Oct 21, 2005 9:30 am

Quoting Yyz717 (Reply 4):

How do you know? Just because no one's done it?

Someone's done it, and someone went bust.


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Quoting Yyz717 (Reply 4):
Not true. Many, many counter-examples.

He is correct. It would be foolish to lower fares further. The smart airlines (like WN) are maximizing the most revenue they can from fares set at the current market rate.

Quoting Yyz717 (Reply 4):

No, it's not fundamentally different. It's actually remarkably similar

Sure it is...

Quoting Yyz717 (Reply 4):
One day an LCC will indeed storm the Atlantic. It's just a matter of time.

But what's to say WN will be the airline to do it? WN's strategy is simmilar to Apple's strategy toward portable entertainment products. Apple was far from the first company to produce a hard-drive digital music player. They sat back, saw that it was a good idea, and produced a superior product. Ditto for the Video I-Pod, there have been portable digital video players for months. Apple has the resources and the know-how to jump into a market if it does take-off.

WN is in the same position. They will probably let a more ambitious carrier attempt a Trans-At LCC first. If they do well, WN may invest in a simmilar venture.

Until then, it's estimated that there are 40-60 cities in the U.S. that WN could serve without any fundamental changes to their opperations. Hence the announcement of service to DEN and RSW in the last 6 months.