God speed to Vanguard. If they are still in the position, as CEO Potter put it, to "spend money to make money," then they have possibilities. On balance, I'd say NJ is here to stay. However, there are pluses and minuses to the new strategy.
First and foremost is the reality that Kansas City is not a huge business center like New York (JetBlue) or Atlanta (AirTran), the two airlines the revamped Vanguard brings to my mind. This has two implications, I think, for a low-fare airline that wants to prosper at a a large-end medium-hub airport where other carriers have failed.
One, the high-yield O&D base is not huge. Installing a business class is risky for a carrier based at MCI. AirTran's business class has the enormous Atlanta corporate base to draw from. Not to mention an already-established reputation for low-fares and numerous destinations (35 is very good for a low-fare carrier today that isn't WN). I haven't read the details of Vanguard's business plan, but when I lived in the KC area ten years ago, I don't remember it being a big corporate center.
Second, 150-seat aircraft like the M80 (142, I think as NJ configures) are big for the KC market. JetBlue has the gargantuan metro New York catchment population to fill its 160-seat A320's. Part of New Braniff's failure at MCI was attributed to its overuse of 150-seat 727's. Again, I haven't read Vanguard's business plan, but MD-80s are ambitious aircraft. They're probably going to need some connecting traffic to keep M80's full. As one person on the KCTV story said, Vanguard isn't very visible elsehwere, so they'll need to really aggressively promote themselves in their other markets. 717s or 73G's, it seems to me, might be more suited to the KC market.
Again, God speed to Vanguard, may they succeed in becoming a strong low-fare airline that can anchor a reasonable fare structure in the KC market for the long term. The new paint scheme is snazzy too. But they'll need to overcome the obstacles discussed above to do it.
Need a new airline paint scheme? Better call Saul! (Bass that is)