daus
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AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:11 am

http://www.jsonline.com/watch/?watch=1&date=2/26/2007&id=19657

AirTran Holdings Inc. (AAI) has taken the unusual step of providing details on the number of new flights and jobs it would add in Milwaukee, if it completes a hostile takeover attempt of Midwest Air Group Inc. (MEH)

AirTran, in a filing with the Securities and Exchange Commission, said it would add 74 daily departures from Mitchell International Airport, while also more than doubling seating capacity and adding 29 new destinations. Midwest Air, which operates Midwest Airlines and Midwest Connect, offers around 140 daily departures from Mitchell International to just over 40 cities.

That increased business would create around 1,100 jobs based in Milwaukee, with an initial payroll of $30 million, said Kevin Healy, AirTran vice president of administration. Midwest Air has 1,865 airline jobs at Mitchell and the company's Oak Creek headquarters.


Filing detail here:

http://www.sec.gov/Archives/edgar/da...45/000119312507039832/dex99a34.htm
 
Indy
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:16 am

Quoting Daus (Thread starter):
has taken the unusual step of providing details on the number of new flights and jobs it would add in Milwaukee

It is unusual and desperate. Nice move to phony up numbers to try and trick people into selling their stock. I'm guessing what they outline is not enforceable. They could get the stock and the company and say "whoops we changed our mind." They are playing the jobs card. Always promise jobs when you want something and threaten jobs when someone wants to take something away from you.
Indy = Indianapolis and not Independence Air
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:23 am

Quoting Indy (Reply 1):
It is unusual and desperate.

You would think they would at least spell check the document before making it an SEC filing. Check out the Job Creation chart. Apparently they are going to need more than 25 people in the "Managerial and Administraiton area to do proper spell checking.  Smile
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:25 am

They boys at NWA are going to take quite an interest in the 5 new MKE departures to Detroit item.
 
MAH4546
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:29 am

Interesting read. Some of the new routes they propose for Milwaukee include Cancun (1x 73G), Miami (1x 73G), Montreal (3x 717), San Juan (1x 73G), Sarasota (1x 717), Vancouver (1x 73G), and White Plains (3x 717). I wonder if they'd keep their word, though, because some seem like overkill, like three daily flights to HPN.

[Edited 2007-02-26 23:33:21]
a.
 
LambertMan
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:38 am

Quoting MAH4546 (Reply 4):
Montreal (3x 717), San Juan (1x 73G), Sarasota (1x 717), Vancouver (1x 73G), and White Plains (3x 717

I'll add to your some and say all but 2.
 
WesternA318
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:42 am

Quoting MAH4546 (Reply 4):
Some of the new routes they propose for Milwaukee include Cancun (1x 73G), Miami (1x 73G), Montreal (3x 717), San Juan (1x 73G), Sarasota (1x 717), Vancouver (1x 73G), and White Plains (3x 717).

I can see the value of starting MKE to CUN, MIA, YUL, SJU, and YVR, but Sarasota and White Plains?
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daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 7:49 am

In addition to new service, they are proposing pretty massive expansion in traffic to BWI, LAX, Hartford CT, Toronto.
 
msnyx
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 8:15 am

This seems awfully desperate to me. Is there even a market for three a day flights to HPN? YX already serves EWR and LGA with 8 flights a day. Airtran seems to be trying to woo Wisconsin residents into thinking that they will be able to fly anywhere their little hearts desire. Non-stop! But if FL was to actually start all of these flights, which is doubtful, the load factor would not be there and pretty soon there would be about the same amount of non-stops as there currently are, minus the signature service.

I am a stubborn Wisconsin resident with a tough little heart. I am perfectly content making stops to get somewhere, so long as it is YX. I will not believe all of these flights or anything that Airtran says until I see it.
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MAH4546
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 8:26 am

Quoting WesternA318 (Reply 6):
I can see the value of starting MKE to CUN, MIA, YUL, SJU, and YVR, but Sarasota and White Plains?

Of those, the only ones I think make any logical sense are Miami and Cancun. Some of the other routes make sense to, like Raleigh and Houston Hobby.
a.
 
steeler83
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 8:42 am

For the love of God, why doesn't FL just stop this nonsense and leave Midwest Air corp ALONE...
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msnyx
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 8:52 am

From what I have seen on this forum, every single Wisconsin resident who has voiced their opinion has been against this deal. FL's plan seems to be attempting to appeal to Wisconsin residents, well this one says no!
If I rise on the wings of the dawn, if I settle on the far side of the sea, even there Your hand will guide me
 
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ERJ170
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:10 am

Quoting Steeler83 (Reply 10):
For the love of God, why doesn't FL just stop this nonsense and leave Midwest Air corp ALONE...

I agree.. everything that AirTran is doing, Midwest can do themselves..

4x MKE-RDU... I would expect Midwest to announce 3x service soon... AirTran isn't really adding any real added benefit.

If AirTran really wanted to put those planes somewhere, they really could with what the destinations they already have. Or they could open up some more.. I don't see why they are so hell bent on getting Midwest..

I could really see Midwest turning this around and suing AirTran for sexual harrassment (since they are seriously riding their @ss) and get some FL profit! LOL...

Anyway, FL has options to put those planes.. Midwest is not interested.. Milwaulkee is not interested.. the Board is not interested.. and the flying public isn't interested.. so who in charge has a woodie for Midwest anyway???? or maybe its Penoid envy? I don't know.. just seems ODD!
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Mikey711MN
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:15 am

Quoting Indy (Reply 1):
It is unusual and desperate. Nice move to phony up numbers to try and trick people into selling their stock.

Well, to be honest, if they pulled the bid tomorrow, how many people are going to sell their stock then? What's the value of YX stock after the bell sounds on that day? 80% of what it is? 75%???

On that note, YX's growth plan of its own, i.e. the basis for any shareholder growth in the future, is predicated primarily on extending mainline YX jets to new destinations at 1x daily service while backfilling its existing routes with CRJs. In other words, bringing the signature brand to limited amounts to markets largely unfamiliar with the product while removing the signature brand to already established amounts already used to the product.

To me, the notion that divulging an "unusual and desperate" amount of information is completely contradictory to how you trick someone. If I'm going to swindle you, I'm going to withhold information, not give you more than you need.

On that note, where are Midwest's new destinations? How are they going to compete with ExpressJet in MCI (presuming that the SkyWest jets were destined for some of those stations now on sale by XJet)? Where's the announcements of downgauging routes like MSP-MKE and PHL-MKE that already show up in the schedules? Midwest has shown very little from their supposed power position, which begs the question...

So who's really doing the tricking?  Smile

Quoting Indy (Reply 1):
I'm guessing what they outline is not enforceable. They could get the stock and the company and say "whoops we changed our mind." They are playing the jobs card. Always promise jobs when you want something and threaten jobs when someone wants to take something away from you.

I know you and I have talked about this some, Indy, but again, it bears repeating: what interest does FL have to pull down the hub in MKE? Didn't their now failed attempt at MDW send the message that FL has a vested desire to get into the midwest region? Surely they didn't pursue those gates to facilitate more ATL and Florida nonstops, or to get more 717s when they've got a boatload of 737s on order.

Are these plans ambitious? Holy cow, yes. Are they subject to change? You bet. What it does show is that much of the FL staff believe that MKE has a future...where the number of destinations is presumably between 41 and 70 and where the number of seats between existing markets is sometimes 1-3 times lower than it could be for a given [lower] price point that the Tran can offer. And if there's anything that Milwaukeeans love--even more than the free cookies--it's a good deal.

It should be interesting no matter what. I'm excited to see what comes of this.
-Mike
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ERJ170
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:21 am

Quoting Mikey711MN (Reply 13):
even more than the free cookies

I tell you what... I had a hot chocolate chip cookie and vanilla ice cream on United recently, and let me tell you.. it was great... I can see why anyone who flies Midwest think so much of them.. its a small gesture with a BIG payback.. it's was well worth the flight.. better than the bag of pretzels and plastic cup of drink I usually get on US...
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Mikey711MN
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:27 am

Quoting ERJ170 (Reply 14):
its a small gesture with a BIG payback..

You don't think FL knows this?

I would bet my paycheck that if a merger went through, you'd see that cookie on all FL flights.

This merger is about buying the loyal value-conscious traveler who will remember that cookie when booking their next flight. YX depends on it because they charge a fare premium. FL's low-cost structure allows them to charge a lower fare, give you the cookie, and still make money.

Otherwise, all you did is just buy a really expensive cookie.

-Mike
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LGAtoIND
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:34 am

3X MKE-YUL, MKE-YVR, 3X MKE-HPN...

Is this a joke?
 
Indy
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:35 am

Quoting Mikey711MN (Reply 13):
I know you and I have talked about this some, Indy, but again, it bears repeating: what interest does FL have to pull down the hub in MKE? Didn't their now failed attempt at MDW send the message that FL has a vested desire to get into the midwest region?

Lets pretend that FL could earn $1 per unit sold in MKE. They can with the same equipment and same amount of effort make $1.50 per unit sold somewhere else. What would be their interest in keeping a hub in MKE? What is the value of the equipment in the deal? What is the value when it comes to getting the equipment now versus picking up a jet here and there on sale or waiting for a delivery here and there from Boeing?

FL has never had an interest in MKE. I don't think they just acquired a taste overnight.
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Mikey711MN
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:39 am

Quoting Indy (Reply 17):
Lets pretend that FL could earn $1 per unit sold in MKE. They can with the same equipment and same amount of effort make $1.50 per unit sold somewhere else.

Really? Where?

-Mike
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stirling
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:39 am

Quote:
Scott Dickson, chief marketing officer for Midwest Air, said that the assumptions Air Tran makes about building traffic to several new destinations are also unrealistic. He cited proposed service between Milwaukee's Mitchell International Airport and Rochester, N.Y., which Air Tran says is part of its plan. "There are about 18 passengers per day traveling in that market," Dickson said. "They are proposing to have 234 seats available ... That doesn't sound very realistic."

The claim is that they intend to build a "Truly National Low-Cost High-Quality Airline". (Don't tell B6 or F9)
Fine.
But putting 234 seats a day into Rochester, while ignoring PDX, SMF, ELP, AUS, OKC, BHM etc....doesn't seem too "National" to me.....but hey, Good Luck in White Plains.

Why does this remind me of Deja Vu all over again...?

Southern and North Central.
Granted, both were a lot smaller and localized than the two contenders we have today in airTran and Midwest...but the parallels are there. Add in a regional West Coast carrier and its perfect.

After 20 years, the game is still the same, expand through acquisition. Using hindsight as my guide, I can see the MKE hub migrate slowly to the south....to MCI, the two will flop positions, with MKE having a few P2P focus city routes. Who cares if the airport at MCI is the antitheses of what a hub airport should look like.
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Indy
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 9:56 am

Quoting Mikey711MN (Reply 18):
Really? Where?

Doesn't even have to be one place. Take the jets and start moving them to cities FL already servces. Use it to expand frequencies and possibly opening new routes between existing cities. Why have 50% o/d when you can have 100% o/d?
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jetjeanes
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:18 am

It will be a great deal on some 717,s
i can see for 80 miles
 
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mariner
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:24 am

Quoting LGAtoIND (Reply 16):
3X MKE-YUL, MKE-YVR, 3X MKE-HPN...

Is this a joke?

Where's the joke? MKE-YVR and MKE-YUL are valid new destinations and Airtran already serves HPN.

???

mariner
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stirling
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:26 am

Quoting Indy (Reply 20):
Take the jets and start moving them to cities FL already servces. Use it to expand frequencies and possibly opening new routes between existing cities.

Which is exactly what Republic (North Central + Southern) did with Hughes Air West. They had no intentions of flying to places like Eugene OR and Fresno CA....but rather the aircraft that flew those routes....to better placed routes like DTW-DCA for example.

This is a bad idea for Midwest, but an inevitable step in the natural evolution in the airline world.  Sad
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n917me
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:45 am

LOL. Unrealistic. Look at the percentage of growth in some of the markets! Sorry, why have a 200+% growth in seats from MKE-BWI.. that market doesn't do to great now, hell. both FL and YX has downgraded service. An increase in seats to CLE? Not needed. Same amount of flights, just more seats to flood the market.. whatever!

AirTran has publically stated that the 50 seaters are not money makers and is a big mistake.. however they have included them in on their proposed plans...interesting.. are they really that bad??

Notice, nothing has been said about jobs in the field.

How is FL going to add 1000+ jobs if YX has a hard time filling the vacancies they have now?? And I know in the field, YX pays much more than FL.

I guess this is what FL planned on trying to present to the shareholders at the annual meeting.
WHATEVER!

[Edited 2007-02-27 02:48:07]
 
Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:46 am

Quoting Mariner (Reply 22):
Where's the joke? MKE-YVR and MKE-YUL are valid new destinations and Airtran already serves HPN.

Well, let's look south.

ORD-YVR is served by UA (3 daily flights; 360 daily seats). AA does not serve the route, nor does AC (with its own metal). Chicago is approximately 4.5 times as large as Milwaukee, and UA has a sizable hub at ORD. Yet, FL somehow plans to fill 137 daily seats on the route?

ORD-HPN is served by S5 and CHQ (6 daily flights; 360 daily seats) and MQ has 9 daily flights (450 daily seats). So CHI-HPN has 810 daily seats. Divide by 4.5 and you get 180 daily seats. FL thinks they can fill twice this many despite the size of the AA and UA hubs?

ORD-YUL is 422 daily AA/MQ seats, 280 daily S5 seats, and 173 daily AC seats. That's 875 daily seats. Dividing once again by 4.5, we get 194, or about 50% of the seats FL plans to offer.

That's the joke.

[Edited 2007-02-27 02:50:05]
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Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:50 am

And on a related note, where are the HPN slots coming from? I thought HPN was pretty close to capacity...
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n917me
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:51 am

Quoting LGAtoIND (Reply 16):
I would bet my paycheck that if a merger went through, you'd see that cookie on all FL flights.

AirTran has already said, they will offer cookies on flights, just not baked, but prepackaged... BIG difference. I can by a prepackaged cookie for .49 at the gas station
 
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JBo
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:54 am

Quoting Mikey711MN (Reply 13):
On that note, YX's growth plan of its own, i.e. the basis for any shareholder growth in the future, is predicated primarily on extending mainline YX jets to new destinations at 1x daily service while backfilling its existing routes with CRJs. In other words, bringing the signature brand to limited amounts to markets largely unfamiliar with the product while removing the signature brand to already established amounts already used to the product.

Your commentary seems to lean largely on the anti-Midwest side of things, as your commentary largely ignores the fact that Midwest has been looking into an aircraft order to replace the MD-80 fleet. Keep in mind, however, that Midwest does not have the money in the bank to suddenly drop a huge amount on A320s or 737s this very moment. For all we know, there could be behind-the-scenes negotiations with Boeing and Airbus over this very matter.

For that matter, your remark about downgrading signature service to regional service: You act as though once Midwest establishes signature service in a market they are obligated to maintain that service, and downgrading to regional is near unspeakable. Other airlines do it all the time. Besides, it should be important to point out that just a couple years ago, routes like MKE-MSP were entirely Skyway routes. Only recently were they upgraded to all-717 service. Obviously, if they're knocking a couple flights down to a CRJ it means that there's not enough traffic on the run to warrant a 717 on every flight.

Why keep an aircraft on a route when a smaller one would make more money and the larger one could be used elsewhere?

Midwest does not expand like most other airlines. They're being very smart and careful about it. It seems particularly smart of them to at least get a foothold in certain markets by introducing 1x flight a day. My guess is once that route is established it will be expanded upon as the aircraft became available.

Quoting Mikey711MN (Reply 13):
On that note, where are Midwest's new destinations? How are they going to compete with ExpressJet in MCI (presuming that the SkyWest jets were destined for some of those stations now on sale by XJet)? Where's the announcements of downgauging routes like MSP-MKE and PHL-MKE that already show up in the schedules?

If you've bothered to read any post by N917ME you'll see the new destinations that are in the works. They will not announce any new ciites formally until at most a couple months before starting service ... too much of an advance notice is not a smart move as it will allow other carriers to jump in on the route as well.

And considering the new SkyWest CRJs are just now starting to come online ... the new cities are going to come one, maybe two at a time rather than all at once seeing as it's nearly impossible to pull 15 CRJs out of thin air and put them on a route.

One thing it seems you do not fully understand or accept is the fact that Midwest does NOT want to be a national carrier, per se. They are a niche carrier and are perfectly happy in that role. Even with the added regional service on CRJs, they still maintain their unique niche. If Midwest is content with service 1 or 2 flights a day from a city and can make money doing so, so be it.

Either way, keep in mind, expansion does not happen overnight. Especially when you don't have a ton of money to put at risk by opening a bunch of routes. If anything, Midwest is expanding the old-fashioned way: starting small with a few flights a day or with smaller aircraft, and if it does well, expanding on the result.

So with all due respect, stop giving Midwest a hard time about their expansion plans. Simply because they are not expanding as ambitiously as AirTran proposes does not make their plan inferior by any means. More is not always better.
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luv2fly
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:54 am

Quoting ERJ170 (Reply 12):
I agree.. everything that AirTran is doing, Midwest can do themselves..

How do tell, they barely made a profit recently, there are no more 717's coming.
You can cut the irony with a knife
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 10:59 am

Quoting ERJ170 (Reply 12):
I don't see why they are so hell bent on getting Midwest..

I think people are getting too caught up at looking at the O&D from these cities into Milwaukee. What this is about, from looking at what they laid out here, is to get people from the East Coast to the West Coast. Milwaukee (and Midwest) is a means to that end. Nothing more. It's a convienent airport in the middle of the country with a small vulnerable airline which happens to hold 50% of the gates in that well located airport. The only twist in this, is that they seem to be targeting NWA's hold on Detroit to boot. In fact, IMO, this is pretty much about targeting Northwest in general, mimmicking what NWA has in Detroit and Minneapolis (without the international flights).
 
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JBo
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:02 am

Quoting Luv2fly (Reply 29):
How do tell, they barely made a profit recently, there are no more 717's coming.

So?

Midwest is perfectly capable of doing everything AirTran wants to do, just not necessarily in the same time frame. Keep in mind that Midwest is actively seeking a replacement for the MD-80s. Just because we haven't seen much publicly on the subject doesn't mean nothing is happening. The fact that they've only recently made a small profit obviously means they are going to be careful and methodical with their expansion plans, including the new aircraft acquisitions.

As I see it, the recent expansion with SkyWest and the CRJs ... and allowing the 717s to expand on other routes and new cities is merely Step 1 in a larger expansion program that will ultimately include the replacement of the MD-80 fleet, which will very likely be more than a one-for-one replacement.
I'd take the awe of understanding over the awe of ignorance any day.
 
luv2fly
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:04 am

Quoting Daus (Reply 30):
I think people are getting too caught up at looking at the O&D from these cities into Milwaukee. What this is about, from looking at what they laid out here, is to get people from the East Coast to the West Coast. Milwaukee (and Midwest) is a means to that end. Nothing more. It's a convienent airport in the middle of the country with a small vulnerable airline which happens to hold 50% of the gates in that well located airport. The only twist in this, is that they seem to be targeting NWA's hold on Detroit to boot. In fact, IMO, this is pretty much about targeting Northwest in general, mimmicking what NWA has in Detroit and Minneapolis (without the international flights).

So true, with the exception of DTW almost any market from DTW that does not fly you into another airlines hub you can bet you are going to make a connection. Airtran can now connect those MI cities via MKE and get those passengers with out the hassle of a DTW fight.
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Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:09 am

Quoting Daus (Reply 30):
I think people are getting too caught up at looking at the O&D from these cities into Milwaukee. What this is about, from looking at what they laid out here, is to get people from the East Coast to the West Coast.

I don't even think there's the O&D to support a connecting operation. Remember, they're fighting 4 good-sized hubs (and 2 smaller ones) that do the exact same thing. Heck, YYZ is arguably competition for some of what they're trying to do too.
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mariner
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:11 am

Quoting Cubsrule (Reply 25):
That's the joke.

I still don't get it.

Just because a legacy already serves a route doesn't mean there isn't room for someone else, LCC - or Midwest.

I think we can assume that some people from northern Chicago (or even Chicago proper) use United's DEN-YUL because there is no MKE-YUL and if Midwest really does have this Milwaukee following, surely some will use them.

All the time I lived in the US people told me that MKE is a somewhat different market from ORD - why else do some airline serve both Chicago and Milwaukee?

???

mariner
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Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:15 am

Quoting Mariner (Reply 34):
and if Midwest really does have this Milwaukee following, surely some will use them.

Yes. But FL will not have the MKE following. They'll just be another game in town.

I've said this before, but if FL could get folks from Milwaukee to fly them, they'd have a heck of a lot bigger operation at MKE than they do today. It's a small station for them, with only ATL and Florida service. YX would have a chance with a seasonal daily YVR flight. YX would probably do all right with some YUL service. FL doesn't enjoy that same loyalty. The MKE market is fickle, and both FL and NW have recently proven that low fares can't attract folks in the same way that they can in many other cities.
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daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:15 am

Quoting Cubsrule (Reply 33):
I don't even think there's the O&D to support a connecting operation.

Well, that where the perceived 'grow, or die' part comes in. They just don't have a better option, so they are going to try and make this work. I think AirTran has decided, one way or the other, that they need to be an airline of the size they've laid out in this proposal. If not MKE/Midwest? How else? Chicago is closed to them. Detroit and Minneapolis are taken. The only other option out there, and I think they are already laying the ground work for this to be Plan B, is St. Louis but that is an even tougher nut to crack competitvely and the geography doesn't work as well to go after NWA directly.
 
luv2fly
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:16 am

Quoting JBo (Reply 31):
So?

Midwest is perfectly capable of doing everything AirTran wants to do

If that was the case then Airtran would not be seeking to buy them. In the long run it is better to be bought out then to be run out of town.
You can cut the irony with a knife
 
Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:25 am

Quoting Daus (Reply 36):
The only other option out there, and I think they are already laying the ground work for this to be Plan B, is St. Louis but that is an even tougher nut to crack competitvely and the geography doesn't work as well to go after NWA directly.

Why in the world would FL want to go after NW (more than any other carrier).

What FL should do instead is learn from NW. The low fare model DOES NOT WORK in MKE. NW tried it. They've now retreated with tails between their legs. Why is FL different?
I can't decide whether I miss the tulip or the bowling shoe more
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:26 am

Quoting Cubsrule (Reply 33):
YYZ is arguably competition for some of what they're trying to do too.

Also, pay attention to how much capacity they intend to add into YYZ. They are going to do battle there as well as DTW.
 
IndyCanuck
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:27 am

Quoting Cubsrule (Reply 25):
Well, let's look south.

ORD-YVR is served by UA (3 daily flights; 360 daily seats). AA does not serve the route, nor does AC (with its own metal). Chicago is approximately 4.5 times as large as Milwaukee, and UA has a sizable hub at ORD. Yet, FL somehow plans to fill 137 daily seats on the route?

ORD-HPN is served by S5 and CHQ (6 daily flights; 360 daily seats) and MQ has 9 daily flights (450 daily seats). So CHI-HPN has 810 daily seats. Divide by 4.5 and you get 180 daily seats. FL thinks they can fill twice this many despite the size of the AA and UA hubs?

ORD-YUL is 422 daily AA/MQ seats, 280 daily S5 seats, and 173 daily AC seats. That's 875 daily seats. Dividing once again by 4.5, we get 194, or about 50% of the seats FL plans to offer.

That's the joke.

And I can chose to fly IND-YVR, IND-HPN and IND-YUL through MKE instead of ORD.

I can also fly to 67 other destinations without transiting through ORD. I avoid ORD whenever possible, and this would give me good opportunity to do just that. For the Midwest pumpers, I get where you are coming from, but what basis do you have not taking what AirTran says in good faith. I'm looking for a good excuse to leave the likes of AA, UA, and NW, and this merger might just be that excuse. I would guess that I am not alone.
 
luv2fly
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:29 am

Quoting Cubsrule (Reply 35):
Yes. But FL will not have the MKE following. They'll just be another game in town.

If this statement was true then NW would not have the size station they do in MKE and Midwest would not have lost money for some many years like they did/had. Also the signature service would still be above yet other airlines offer and they would be no saver service offered as people would gladly pay whatever Midwest charged. This is the real world.
You can cut the irony with a knife
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:30 am

Quoting Cubsrule (Reply 38):
They've now retreated with tails between their legs. Why is FL different?

Because, again my point is that this has very little to do with capturing the hearts and minds of Milwaukean's.  Smile This is about becoming national airline, with a national advertising campaign, that this moving East Coaster through Milwaukee to the West Coast. NWA tried to BEAT Midwest by winning the market. FL has no intention of doing that.
 
Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:30 am

Quoting IndyCanuck (Reply 40):
For the Midwest pumpers, I get where you are coming from, but what basis do you have not taking what AirTran says in good faith.

You can't fill 50% of the seats that ORD fills on a hub that is maybe 1/3 of the size of the ORD hubs and local traffic that is 1/5 that of ORD. That math just doesn't work.
I can't decide whether I miss the tulip or the bowling shoe more
 
mkirch72
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:32 am

Quoting Mikey711MN (Reply 15):
I would bet my paycheck that if a merger went through, you'd see that cookie on all FL flights.

Are you kidding me? IF, and I mean IF, FL adopted this, they'd probably ship in generic cookies from Costco that are the size of a quarter and everyone would get just one. That is, if they would be actually willing to put the money into it.

This would be like Wal-Mart taking over Nordstroms. Do you seriously think that Wal-Mart is going to begin employing personal shoppers with a professional demeanor and who can do more than just say "Welcome to Wal Mart"? I doubt it.

I worked for a company (MBNA) that was known for being #1 in customer service as well as having wonderful benefits and an employee centered culture. Then the largest retail bank in the US (Bank of America) stepped in stating what wonderful cynergies this would create. They sang the praises of my former employer, promising to 'export' their successful approach to both customers and employee relations. So a merger was announced. Keep in mind, this was a mutually agreed upon deal. Nothing "hostile" about it.

Fast forward a year, many have been laid off (thousands). Offices were closed in Maine, Delaware, New Hampshire, New York. Those that are left have expressed their concerns to their new bosses and were told, point blank, in a memo distributed to all that pretty much said - you work for us now, quit complaining because we are not going to change. Of course it was worded a little more politely.

But to those who support this hostile takeover, if you think for a second FL's intentions are any different than what I described above, you're sadly mistaken. That is how corporate America works. It is not a pretty world. The one and only interest for them is to satisfy the greed of their management and their shareholders. And every publicly held company in this country is exactly the same. They may put on a nice face for the media and for employees & customers, but their one and only interest is growing profits for themselves and their shareholders. Everything else is secondary.
 
Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:35 am

Quoting Daus (Reply 42):
NWA tried to BEAT Midwest by winning the market. FL has no intention of doing that.

A connecting hub does not work without local traffic. FL seems to understand this in ATL. What is the problem in MKE?
I can't decide whether I miss the tulip or the bowling shoe more
 
daus
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:47 am

Quoting Cubsrule (Reply 45):
A connecting hub does not work without local traffic.

Oh, I'm sure they think they'll hold on to a good chuck of the current YX traffic, they've just decided to buy that traffic rather than try and win that traffic.

I think to understand what they are up to, you have to play the following game. "I am FL, I want to be twice my current size and become a national airline. What are my options?". As I said above, where do you go if not MKE? This is one of the reasons that the YX investors haven't folded. It isn't just their love of YX, it's that they know FL is over a barrel. FL has a multi-billion dollar expansion plan at risk and they might just pay twice the current offer for YX in fear of seeing that expansion plan go up in smoke or be hamstrung from the get go.
 
IndyCanuck
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 11:48 am

Quoting Cubsrule (Reply 25):
ORD-YVR is served by UA (3 daily flights; 360 daily seats). AA does not serve the route, nor does AC (with its own metal). Chicago is approximately 4.5 times as large as Milwaukee, and UA has a sizable hub at ORD. Yet, FL somehow plans to fill 137 daily seats on the route?

Let's look at it this way. I fly to YVR once a year to visit family. When AirTran starts serving this route I will choose to fly IND-MKE-YVR instead of IND-ORD-YVR. One seat filled. I will not be alone in choosing to avoid ORD at all costs.
 
Cubsrule
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RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 12:02 pm

Quoting IndyCanuck (Reply 47):
Let's look at it this way. I fly to YVR once a year to visit family. When AirTran starts serving this route I will choose to fly IND-MKE-YVR instead of IND-ORD-YVR. One seat filled. I will not be alone in choosing to avoid ORD at all costs.

UA fills 360 daily seats on the route. Let's say the flight is 30% local traffic.

So the local population fills 108 seats. We could expect local folks in Milwaukee to fill 24 seats.

UA operates a hub of approximately 650 flights at ORD. Connecting passengers fill approximately 252 seats.

Certeris paribus, we could expect FL's 214 daily flights to yield approximately 83 passengers.

That's 107 daily butts, and 137 daily seats, for a rough load factor of 78% (assuming UA is at a 100% L/F, which they're not). Can that make money?

I would argue that FL is not building a hub of sufficient size to support all of this service.
I can't decide whether I miss the tulip or the bowling shoe more
 
MUWarriors
Posts: 192
Joined: Wed May 04, 2005 12:11 pm

RE: AirTran Details Plans For Midwest To SEC

Tue Feb 27, 2007 12:53 pm

This move smells of a "Hail Mary," but that may just be me.

Quoting Mikey711MN (Reply 13):
To me, the notion that divulging an "unusual and desperate" amount of information is completely contradictory to how you trick someone. If I'm going to swindle you, I'm going to withhold information, not give you more than you need.

Not me, if I am trying to trick someone I tell them what they want to hear, under no obligation of me actually following through with it. That way not only do they think what I want them to, but when it fails I can blame it on them, because I gave them the details beforehand.

Quoting JBo (Reply 28):
One thing it seems you do not fully understand or accept is the fact that Midwest does NOT want to be a national carrier, per se. They are a niche carrier and are perfectly happy in that role. Even with the added regional service on CRJs, they still maintain their unique niche. If Midwest is content with service 1 or 2 flights a day from a city and can make money doing so, so be it.

Exactly!!!

Quoting Daus (Reply 30):
I think people are getting too caught up at looking at the O&D from these cities into Milwaukee. What this is about, from looking at what they laid out here, is to get people from the East Coast to the West Coast. Milwaukee (and Midwest) is a means to that end. Nothing more. It's a convienent airport in the middle of the country with a small vulnerable airline which happens to hold 50% of the gates in that well located airport. The only twist in this, is that they seem to be targeting NWA's hold on Detroit to boot. In fact, IMO, this is pretty much about targeting Northwest in general, mimmicking what NWA has in Detroit and Minneapolis (without the international flights).

There is a reason connecting only hubs are slowly falling away. Like why MEM is always being threatened, or CVG is RJ city, or why PIT was sadly already cut back and CMH was completely dropped by HP. Connections are not the way you make money, especially if you have to have cut rate fares to do it.

Quoting Mariner (Reply 34):
All the time I lived in the US people told me that MKE is a somewhat different market from ORD - why else do some airline serve both Chicago and Milwaukee?

They are different markets, and MKE is significantly smaller. That is why he is saying that the raw numbers don't make sense. He is using numbers to say (I think), an airline with 8.5 million people to draw from, plus a huge connecting hub has this many seats on a route. FL plans on this many seats for an area of 1.9 (including Kenosha) million people, and at best a mid-sized connecting hub, the numbers don't add up.

Quoting IndyCanuck (Reply 40):
but what basis do you have not taking what AirTran says in good faith.

Because their numbers don't make sense. It's one thing if they said, we will keep a similar sized operation, maybe add a city or two. But 3x daily to HPN? EWR barely supports that kind of service, and CO has a huge hub at one end, and MKE fliers love YX at the other.

Quoting Luv2fly (Reply 41):
If this statement was true then NW would not have the size station they do in MKE and Midwest would not have lost money for some many years like they did/had.

NW has been number 1 or 2 in MKE forever. That is why they have the sized operation that they do (although currently only flights to the 3 hubs exsist), people in Milwaukee are loyal, and so a fair number have stuck with NW through their build-ups, and pull backs. YX lost money when most airlines did, and they were trying to relocate their niche in the market. However, throughout their money losing times their marketshare at MKE actually increased. Now they know where they stand, and know how much more Milwaukeans are willing to pay to fly them, and support the local company.

Quoting Daus (Reply 46):
Oh, I'm sure they think they'll hold on to a good chuck of the current YX traffic, they've just decided to buy that traffic rather than try and win that traffic.

I'd bet dollars to donuts that the second the takeover happens NW ramps up service, and regains a chunk of the market. What percent do you think FL would keep? I would guess FL would be lucky to have a 30% market share in MKE when everything falls out. In the end MKE would be pretty similar to what IND, and CMH are now.

Quoting Daus (Reply 46):
As I said above, where do you go if not MKE?

Well, STL has a concourse setting empty, IND will have a brand new terminal pretty quick, CMH no longer has a hub of any sort, PIT has some room, and all three are better connection points than MKE, which is tucked in the northern third of the country.