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enilria
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UA Sees Transatlantic Turning Sharply Negative

Wed Nov 09, 2016 11:40 pm

This is a bit of forboding. I'm sure BA's three new transatlantic routes won't help.

The October numbers showed United's consolidated traffic for October rose only 0.6 percent year over year. Domestic traffic grew 2.3 percent year over year, but across the Atlantic, traffic dropped a very significant 4.9 percent year over year.

Undoubtedly, currency exchange rates have made it more expensive for Europeans to visit the United States in recent months. And Americans may be more wary of traveling to Europe because of lingering concerns about terrorism.


http://www.bizjournals.com/chicago/news ... ?ana=yahoo
 
commavia
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Re: UA Sees Transatlantic Turning Sharply Negative

Wed Nov 09, 2016 11:43 pm

No real surprise. All three U.S. network carriers have now been saying the same thing, progressively more alarmingly, for several quarters. The economic conditions across the Atlantic aren't good. Fears of terrorism are hurting. Exchange rates are hurting. Brexit uncertainty is hurting. General, broader economic weakness in Europe is hurting. An influx of new competition is hurting. Long story short - transatlantic isn't exactly doing great these days.
 
slcdeltarumd11
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 12:01 am

The European market was so lucky to have lasted as long as it did for the legacies. The ulcc potential is only starting. Cities like pit are gonna start popping up with less then daily service. Thus will keep eroding united feed and lower fares. They know how large a share is not date sensitive and see their feed shrinking quickly.
 
msycajun
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 12:07 am

This is the problem with the "capacity discipline" exercised by the legacies. They thought they had the market tied up and could push up fares even when making record profits. Now the Euro LCCs are coming in as the domestic ULCCs have been doing in the US, and the legacies will be in a bind when oil jumps or traffic dives.
 
commavia
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 12:10 am

msycajun wrote:
This is the problem with the "capacity discipline" exercised by the legacies. They thought they had the market tied up and could push up fares even when making record profits. Now the Euro LCCs are coming in as the domestic ULCCs have been doing in the US, and the legacies will be in a bind when oil jumps or traffic dives.


I disagree. I don't think the U.S. network carriers were under any illusion that they could pull down their own capacity and lower-cost operators wouldn't come in and backfill it. That is exactly what happened in the U.S. domestic market for much of the last decade, so I don't see why AA, Delta and United wouldn't reasonably expect it to happen again across the Atlantic. On the contrary, I think they just decided that said competition was coming - one way or another - and it was going to cater to a segment of the market that was simply no longer accessible at network carrier cost levels. And so the network carriers just preemptively self-selected out of catering to that segment.
 
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lesfalls
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 12:52 am

Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised! I think it also has to do with the fact that the US3 have not realized that they should lower their fares. I fly at least 2x across the atlantic and 90% of the time it's on a E.U carrier because the american carrier is double the price. I would also say the service onboard EU carriers is better (I'm speaking about Economy. Business is a different story). It's really the american carriers fault if they don't want to change/improve.
Last edited by lesfalls on Thu Nov 10, 2016 1:11 am, edited 1 time in total.
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Delta757MD88
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 1:09 am

lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised! I think it also has to do with the fact that the US3 have not realized that they should lower their fares. I fly at least 2x across the atlantic and 90% of the time it's on a E.U carrier because the american carrier is double the price. I would say the service onboard EU carriers is better (I'm speaking about Economy. Business is a different story). It's really the american carriers fault if they don't want to change/improve.


I totally agree with that statement, if given the option I would pick Business on LH, AF, or KL any day over DL, UA, or AA. The service is just so much better. The prices on any of the US3 are almost double on some routes compared to european carriers.
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mjoelnir
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:02 am

At the same time North Atlantic traffic stagnates at the US legacies, North Atlantic traffic at Icelandair and WOW grows in leaps and bounds. Norwegian grows its North Atlantic business and US airlines try to keep them out as far as possible. Alliances and joint ventures have killed competition between the big players. If you allow competition to be killed, the market dies or it opens up for new competitors.
 
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LAX772LR
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:20 am

mjoelnir wrote:
Alliances and joint ventures have killed competition between the big players.

That's something that's popular to claim/repeat among aviation enthusiasts, but has never really been demonstrated to any proven effect here.

I'd argue the exact opposite: that they've given the Legacies and large Euro carriers access to markets that their own networks/costs would not have allowed them to have a presence or effectively compete in.
I myself, suspect a more prosaic motive... ~Thranduil
 
styles9002
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:26 am

commavia wrote:
Exchange rates are hurting.


ForEx is a zero sum game, someone wins and someone loses. For everyone 'hurt', another person is 'helped' in an equal manner.
It is what it is.
 
commavia
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:28 am

styles9002 wrote:
ForEx is a zero sum game, someone wins and someone loses. For everyone 'hurt', another person is 'helped' in an equal manner.


Not necessarily. If a forex movement tends to make travel relatively more expensive for the travelers at one end of a route, and less expensive for those at the other end, but it occurs at a time during the year or macroeconomic cycle where the travelers suddenly paying more are the ones who drive more of the traffic on the route, that can hurt everyone. It is certainly true that airlines can attempt to shift more of the point of sale in a given market from one end of a route to another if it's more favorable from a forex standpoint, but in practice this can only be done to a certain extent - and typically doesn't realistically result in fulling recovering what is lost.
 
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mercure1
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:30 am

styles9002 wrote:
ForEx is a zero sum game, someone wins and someone loses. For everyone 'hurt', another person is 'helped' in an equal manner.


Except airline markets are not equal in demand.

Travel demand point of sale is hardly 50/50 split between the US and Europe, the same way its not 50/50 to/from Asia, Latin America, etc,

So as result when currencies move it can create shifts in travel demand that are simply not compensated by the opposite side point of sale.
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MIflyer12
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:46 am

mjoelnir wrote:
At the same time North Atlantic traffic stagnates at the US legacies, North Atlantic traffic at Icelandair and WOW grows in leaps and bounds.


Icelandair and WOW are such small components of the total market that their growth doesn't begin to cover the legacy carrier decline.
 
iadadd
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 5:05 am

Well, time for UA to maybe add some capacity to the Pacific ?
 
mjoelnir
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 6:10 am

MIflyer12 wrote:
mjoelnir wrote:
At the same time North Atlantic traffic stagnates at the US legacies, North Atlantic traffic at Icelandair and WOW grows in leaps and bounds.


Icelandair and WOW are such small components of the total market that their growth doesn't begin to cover the legacy carrier decline.


That is not my point, the increase in pax is the point, with growth around 25% per year. That counts only transfer passengers, and not people doing a stop over.
Apart from the above, flying over 1 million pax over the North Atlantic is not that insignificant,
WOW is a complete extra the last years, not as big as Icelandair but growing still faster.
All transfer passengers in KEF including October this year, that is 99% trans Atlantic travel shared by WOW and Icelandair, is already a little bit less than 1.9 million pax.
Up from less than 1.5 million last year.
What does AA do, about 4 million pax on the North Atlantic route?
Last edited by mjoelnir on Thu Nov 10, 2016 6:29 am, edited 3 times in total.
 
YIMBY
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 6:15 am

mercure1 wrote:
styles9002 wrote:
ForEx is a zero sum game, someone wins and someone loses. For everyone 'hurt', another person is 'helped' in an equal manner.


Except airline markets are not equal in demand.

Travel demand point of sale is hardly 50/50 split between the US and Europe, the same way its not 50/50 to/from Asia, Latin America, etc,

So as result when currencies move it can create shifts in travel demand that are simply not compensated by the opposite side point of sale.


More than that, the changes generate uncertainty. Tourists may not want to travel to find out that after paying for the flight and hotel they have no more money for eating.

Unfortunately, uncertainties are growing drastically both sides of the Atlantic and we cannot rule out a trade war or semiaccidental restrictions for air traffic. Nevertheless, I do not believe that so many Americans will be escaping to Europe that it would produce a significant increase in traffic, but who knows.
 
slinky09
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 7:45 am

Delta757MD88 wrote:
lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised! I think it also has to do with the fact that the US3 have not realized that they should lower their fares. I fly at least 2x across the atlantic and 90% of the time it's on a E.U carrier because the american carrier is double the price. I would say the service onboard EU carriers is better (I'm speaking about Economy. Business is a different story). It's really the american carriers fault if they don't want to change/improve.


I totally agree with that statement, if given the option I would pick Business on LH, AF, or KL any day over DL, UA, or AA. The service is just so much better. The prices on any of the US3 are almost double on some routes compared to european carriers.


I am not surprised that UA is struggling more than others - their reputation for service is dreadful on this side of the atlantic and no one I know chooses UA above anyone else unless their corporate travel team forces them to use UA, that and the aforementioned economic uncertainty and threat of terrorism in continental europe ... it's a toxic mix for UA.
 
codc10
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 1:24 pm

slinky09 wrote:
Delta757MD88 wrote:
lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised! I think it also has to do with the fact that the US3 have not realized that they should lower their fares. I fly at least 2x across the atlantic and 90% of the time it's on a E.U carrier because the american carrier is double the price. I would say the service onboard EU carriers is better (I'm speaking about Economy. Business is a different story). It's really the american carriers fault if they don't want to change/improve.


I totally agree with that statement, if given the option I would pick Business on LH, AF, or KL any day over DL, UA, or AA. The service is just so much better. The prices on any of the US3 are almost double on some routes compared to european carriers.


I am not surprised that UA is struggling more than others - their reputation for service is dreadful on this side of the atlantic and no one I know chooses UA above anyone else unless their corporate travel team forces them to use UA, that and the aforementioned economic uncertainty and threat of terrorism in continental europe ... it's a toxic mix for UA.


UA's service has little to do with the macro picture. TATL demand and revenues are sagging and UA has too much capacity in the market. It's one reason the 3-cabin 777-222s (A-market), which primarily served the North Atlantic, are being reconfigured and transitioned to domestic.

Fortunately Asia remains strong and Latin/Deep Sa in particular are showing signs of recovery, so we will probably see capacity reallocated in that respect.
 
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Polot
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 1:52 pm

slinky09 wrote:
Delta757MD88 wrote:
lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised! I think it also has to do with the fact that the US3 have not realized that they should lower their fares. I fly at least 2x across the atlantic and 90% of the time it's on a E.U carrier because the american carrier is double the price. I would say the service onboard EU carriers is better (I'm speaking about Economy. Business is a different story). It's really the american carriers fault if they don't want to change/improve.


I totally agree with that statement, if given the option I would pick Business on LH, AF, or KL any day over DL, UA, or AA. The service is just so much better. The prices on any of the US3 are almost double on some routes compared to european carriers.


I am not surprised that UA is struggling more than others - their reputation for service is dreadful on this side of the atlantic and no one I know chooses UA above anyone else unless their corporate travel team forces them to use UA, that and the aforementioned economic uncertainty and threat of terrorism in continental europe ... it's a toxic mix for UA.


Is UA struggling more than others, or they all about the same?

This article is just about the October traffic report UA released. Without looking at the DL/AA traffic reports (I do not know if they have been released or not) we can't say if UA is doing better or worse than their American peers over the Atlantic.
 
flyby519
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 1:59 pm

Polot wrote:
slinky09 wrote:
Delta757MD88 wrote:

I totally agree with that statement, if given the option I would pick Business on LH, AF, or KL any day over DL, UA, or AA. The service is just so much better. The prices on any of the US3 are almost double on some routes compared to european carriers.


I am not surprised that UA is struggling more than others - their reputation for service is dreadful on this side of the atlantic and no one I know chooses UA above anyone else unless their corporate travel team forces them to use UA, that and the aforementioned economic uncertainty and threat of terrorism in continental europe ... it's a toxic mix for UA.


Is UA struggling more than others, or they all about the same?

This article is just about the October traffic report UA released. Without looking at the DL/AA traffic reports (I do not know if they have been released or not) we can't say if UA is doing better or worse than their American peers over the Atlantic.


AA doesn't look much better:

http://finance.yahoo.com/news/american- ... 00475.html

DL:

http://finance.yahoo.com/news/delta-rep ... 00542.html
Last edited by flyby519 on Thu Nov 10, 2016 2:03 pm, edited 2 times in total.
 
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Polot
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:02 pm

flyby519 wrote:
Polot wrote:
slinky09 wrote:

I am not surprised that UA is struggling more than others - their reputation for service is dreadful on this side of the atlantic and no one I know chooses UA above anyone else unless their corporate travel team forces them to use UA, that and the aforementioned economic uncertainty and threat of terrorism in continental europe ... it's a toxic mix for UA.


Is UA struggling more than others, or they all about the same?

This article is just about the October traffic report UA released. Without looking at the DL/AA traffic reports (I do not know if they have been released or not) we can't say if UA is doing better or worse than their American peers over the Atlantic.


AA doesn't look much better:

http://finance.yahoo.com/news/american- ... 00475.html


Yup, ASM down 1.4% YoY over the Atlantic but RPM down 8.3%, and I would expect AA's numbers YoY to be the "best" of the US3 over the Atlantic as they fly to far fewer secondary cities in Europe than UA/DL.

DL's ASM are up 4.1% YoY but RPM down 4.4%.

UA's ASM were up 1.1% YoY but RPM down 4.9%.

All things considered UA is not performing worse than their peers over the Atlantic...
Last edited by Polot on Thu Nov 10, 2016 2:12 pm, edited 1 time in total.
 
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STT757
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:12 pm

Fortunately Asia remains strong and Latin/Deep Sa in particular are showing signs of recovery, so we will probably see capacity reallocated in that respect.


Would love to see EWR-EZE, EWR-GIG and EWR-SCL brought back.
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skipness1E
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:24 pm

slcdeltarumd11 wrote:
The European market was so lucky to have lasted as long as it did for the legacies. The ulcc potential is only starting. Cities like pit are gonna start popping up with less then daily service. Thus will keep eroding united feed and lower fares. They know how large a share is not date sensitive and see their feed shrinking quickly.

There's one carrier, they're not ULCC and they're not making a lot of money. Not convinced the future is Norwegian.
 
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TheLion
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:25 pm

Yesterday's election results might further depress demand. From Latin America the US suddenly is not an attractive place to visit. We Europeans are all having second thoughts about going there too. Even protectionist aviation policies won't have much impact.
 
slcdeltarumd11
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:28 pm

I think we will see the legacies roll back and relying on hubs more via partners connections in Europe. The days of the legacies only competing against each other is ending. Yields are gonna be crashing and competition is going up.

The best news is for a city like PIT to land WOW. They will really crash prices to europe and limit what the legacies can get. It doesn't need to be daily to put pricing pressure on. Allegiant has really shown the leisure passengers will work around your schedule if you give them a cheap seat. Less then daily is better, fly totally full planes less often.
 
Cory6188
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 2:36 pm

I think the US legacies have shot themselves in the foot by getting absurdly greedy with TATL airfare. I fly to Europe fairly frequently for work from JFK/EWR and BOS, and without a Saturday night stay, airfare to the UK, Germany, etc. is often >$2000 for plain old Y.

These days, Norwegian from JFK-LGW is closer to $1000 without a Saturday night stay...so no wonder the legacies are feeling the downward pricing pressure. You get greedy, collude on pricing, and someone else is going to swoop in and undercut your prices.
 
AEROFAN
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:00 pm

Cory6188 wrote:
I think the US legacies have shot themselves in the foot by getting absurdly greedy with TATL airfare. I fly to Europe fairly frequently for work from JFK/EWR and BOS, and without a Saturday night stay, airfare to the UK, Germany, etc. is often >$2000 for plain old Y.

These days, Norwegian from JFK-LGW is closer to $1000 without a Saturday night stay...so no wonder the legacies are feeling the downward pricing pressure. You get greedy, collude on pricing, and someone else is going to swoop in and undercut your prices.


When do you think the downward pressure on prices will go into effect? I'm willing to travel to Europe, but not at the current BIZ or First class prices. And I don't travel coach for any flight over 4 hours.
 
cruiseshipcrew
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:12 pm

lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised!


Funny you mention HAM because I'm booking tickets there for a cruise and United wanted $1,700 for coach RT when others are half of that.
James - Road Warrior
 
bgm
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:12 pm

Cory6188 wrote:
I think the US legacies have shot themselves in the foot by getting absurdly greedy with TATL airfare. I fly to Europe fairly frequently for work from JFK/EWR and BOS, and without a Saturday night stay, airfare to the UK, Germany, etc. is often >$2000 for plain old Y.

These days, Norwegian from JFK-LGW is closer to $1000 without a Saturday night stay...so no wonder the legacies are feeling the downward pricing pressure. You get greedy, collude on pricing, and someone else is going to swoop in and undercut your prices.


Exactly.

Why anyone would pay $2k for a crappy coach seat with equally crappy service on a US legacy is beyond me.

Flown Norwegian several times TATL in their premium Y and it's excellent value.
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mjoelnir
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:23 pm

UA is flying about 5 million pax over the North Atlantic, a 5% decrease means 250,000 less passenger a year. WOW and Icelandair together have a 580.000 passenger increase the first 10 month in 2016 against the first 10 month in 2015. Norwegian is growing on the North Atlantic routes and adding routes too.

Are passenger not just moving themselves between airlines, rather than there is a decrease in traffic?
 
codc10
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:27 pm

Polot wrote:
Yup, ASM down 1.4% YoY over the Atlantic but RPM down 8.3%, and I would expect AA's numbers YoY to be the "best" of the US3 over the Atlantic as they fly to far fewer secondary cities in Europe than UA/DL.


AA has the most UK exposure, so Brexit uncertainty hurts them most. UA is also heavily exposed to the UK but more balanced to the rest of the Continent than AA.

STT757 wrote:
Would love to see EWR-EZE, EWR-GIG and EWR-SCL brought back.


I think the return of EWR-EZE is possible, but IMO much more likely is the tactical upgauges of 767s to 777s on existing routes.
 
frmrCapCadet
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 3:38 pm

Cory6188 wrote:
I think the US legacies have shot themselves in the foot by getting absurdly greedy with TATL airfare. I fly to Europe fairly frequently for work from JFK/EWR and BOS, and without a Saturday night stay, airfare to the UK, Germany, etc. is often >$2000 for plain old Y.

These days, Norwegian from JFK-LGW is closer to $1000 without a Saturday night stay...so no wonder the legacies are feeling the downward pricing pressure. You get greedy, collude on pricing, and someone else is going to swoop in and undercut your prices.


The legacies have fallen into a market trap of 'customer as the enemy'. I can be all in favor of fees, and don't object to them being profitable. But 'gotcha' fees, convoluted restrictions, and an host of other mistreatments of customers makes it difficult to feel any pain at failing airlines.
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avek00
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 4:35 pm

Let's bring this discussion out of the mid-2000s and relevant to current conditions:

1. On product, US carriers rapidly closed the gap, and in some ways are now superior to their European partners in Economy and Business Class.

2. For carriers in the TATL JVs, fare pricing is a joint exercise. That said, over the past couple years each JV has been trying to maximize the brand strength of each partner, differentiating fare availability (and fuel surcharges, etc.) by marketing carrier code. After all, if you'll pay $200 more for an AA coded flight than a BA coded flight, why not sell it to you as AA and get the money?

3. In some respects, I'd expect US carriers to feel a greater impact in TATL market weakness because they are able to undertake flying on thinner routes that their European partners lack the cost base and equipment to feasibly operate.

Keep calm, and carry on.
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enilria
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 5:39 pm

commavia wrote:
I disagree. I don't think the U.S. network carriers were under any illusion that they could pull down their own capacity and lower-cost operators wouldn't come in and backfill it.

Exactly
slcdeltarumd11 wrote:
The European market was so lucky to have lasted as long as it did for the legacies. The ulcc potential is only starting. Cities like pit are gonna start popping up with less then daily service. Thus will keep eroding united feed and lower fares. They know how large a share is not date sensitive and see their feed shrinking quickly.

Then why try so desperately to keep DY out and block the ME3 from 5th Freedom? ME3 5th Freedom is far less damaging than WOW or DY adding a bunch of routes because EK's JFK-MXP connects to nothing but DXB.
avek00 wrote:
1. On product, US carriers rapidly closed the gap, and in some ways are now superior to their European partners in Economy and Business Class.

I'd say the DL J product is close or better to all the Euro carriers.
avek00 wrote:
2. For carriers in the TATL JVs, fare pricing is a joint exercise.

I'd say there is a dominant airline in that space at each JV alliance. It's DL for ST, probably LH for *A, and BA for OW although I expect AA may overtake that now.
avek00 wrote:
3. In some respects, I'd expect US carriers to feel a greater impact in TATL market weakness because they are able to undertake flying on thinner routes that their European partners lack the cost base and equipment to feasibly operate.

I think one major problem with the article is that they missed the fact that the USA carriers carry a heavily disproportionate share of American traffic, whereas the foreign carriers have the reverse. UA seeing that kind of drop probably means more about Americans reducing travel than Europeans. Having been in Europe recently, I will say that the migrant crisis is a significant negative to tourism.
 
Flighty
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 6:23 pm

Europe is in decline. It will get worse, before it gets better (ideally with the dissolution of the EU).

Sounds crazy? Well, do you think Spain has done well by the EU? Because I really don't.
 
rwsea
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 6:44 pm

avek00 wrote:
1. On product, US carriers rapidly closed the gap, and in some ways are now superior to their European partners in Economy and Business Class.

I'd say the DL J product is close or better to all the Euro carriers.

Not sure I would go that far. The service on my last two flights was sloppy at best, unprofessional at worst. And the lounges are terrible.
 
ahmetdouas
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 6:45 pm

I generally avoid American carriers because their planes are falling apart and have many more mechanical failures. I will not fly TATL with a 767-300ER or 757-200 when I can do so with a 77W. Only American flies new planes JFK-LHR with their 77W's.
 
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XLA2008
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 7:51 pm

Might have something to do with how greedy they are in pricing! It's far cheaper to fly with European carriers than US carriers most of the time!
“For once you have tasted flight you will walk the earth with your eyes turned skywards, for there you have been and there you will long to return.“
 
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lesfalls
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 8:01 pm

cruiseshipcrew wrote:
lesfalls wrote:
Well if UA is trying to sell EWR-HAM at $1,200 RT (just an example) in January then they should not be surprised!


Funny you mention HAM because I'm booking tickets there for a cruise and United wanted $1,700 for coach RT when others are half of that.

Haha. We'll HAM's only direct flight to NA is operated by UA so it shows how bad the situation is. I didn't know the price went so high though for EWR-HAM. Hope it goes down because just by looking on the seatmap of their flight on Jan 27 2017 they have a long way to go to getting it to a reasonable load.
Lufthansa: Einfach ein bisschen mehr.
 
airbazar
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 8:45 pm

Translation: we can't compete with the LCC in the TATL market.
UA has long given up on the TATL market. They rely on their JV with LH to carry that market. What's left of UA will continue to shrink as the LH group increases their offering in the TATL market. In addition, LCC's are starting to expand TATL. That too will lead to less of a presence by UA as well as other legacy carriers.
 
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Polot
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 8:51 pm

airbazar wrote:
Translation: we can't compete with the LCC in the TATL market.
UA has long given up on the TATL market. They rely on their JV with LH to carry that market. What's left of UA will continue to shrink as the LH group increases their offering in the TATL market. In addition, LCC's are starting to expand TATL. That too will lead to less of a presence by UA as well as other legacy carriers.

You say, completely ignoring the fact that UA actually had slightly more capacity across the Atlantic this year compared to last year...
 
freakyrat
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 8:53 pm

I fly to HAM at least twice a year and my UA ticket in May in Y is $1200 R/T from DFW. I used to do AA on this route connecting to BA in London but the fare went up to close to $1700 for May. You have to remember most of the cost of a TATL ticket is in fees and taxes. United by far is the most reasonable fare considering and there is no need to connect in London Heathrow or take a train from Frankfurt and only a three hour layover at EWR for me to stretch my feet etc.
 
SonomaFlyer
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 9:04 pm

airbazar wrote:
Translation: we can't compete with the LCC in the TATL market.
UA has long given up on the TATL market. They rely on their JV with LH to carry that market. What's left of UA will continue to shrink as the LH group increases their offering in the TATL market. In addition, LCC's are starting to expand TATL. That too will lead to less of a presence by UA as well as other legacy carriers.


Would this be the same UA that flies to more destinations in Europe on its own metal than any other U.S. based airline? Would this be the same airline that flies to Europe from LAX, SFO, ORD, IAD, EWR and IAH?

I agree Norwegian and the like will put added pressures on the legacy carriers but I don't see UA giving up on TATL. They will adjust capacity as they must as will the other carriers. The joint venture partners of the legacy carriers are under the same pressures and will need to make similar adjustments.
 
IAHWorldflyer
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 10:05 pm

UA doesn't do business flyers ( the ones buying premium seats) any favors on trans-Atlantic flights when, outside of Summer, many of their routes go less than daily. So, if you only have to be over there for 2 or 3 days, you likely will find that a UA flight doesn't operate on your travel day in at least one direction. LH, KL, BA and AF have the big hubs there, so flights are almost always daily in Fall/Winter/Spring. It's less hasssle just to book with one of the Euro legacies. I can't speak to AA, but DL seems to be daily on most of the big runs out of Atlanta in the Fall and Winter.
 
G-CIVP
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 10:53 pm

I'm surprised because given the appreciation of the USD against the Pound I would have thought pax numbers would have been up unless the fare pricing is completely off-beam.
 
steveinbc
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Re: UA Sees Transatlantic Turning Sharply Negative

Thu Nov 10, 2016 11:40 pm

There are so many factors involved of course but I believe the drivers are: (I) fares are far too high - as already noted a Feb 2017 fight from the west coast to Europe is around $1200 - yet most carriers are reporting fuel is around 25% of total costs as opposed to 40% a couple of years ago (ii) I think that UA is impacted a little more because of their largely unmodern fleet on their transatlantics and relatively poor service (iii) general economic conditions for US and EU/UK are not optimal especially for the financial centres who feed premium fares and (iv) the rise of charter airlines and ULCCs are bleeding tourists/infrequent flyers away from legacy carriers. I am unsure how significant an impact the introduction of US/Canada flights to the Indian subcontinent westbound/trans-Pacific is having but traditionally most travellers went via LHR or FRA onwards to India/Pakistan
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Bald1983
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Re: UA Sees Transatlantic Turning Sharply Negative

Fri Nov 11, 2016 12:51 am

enilria wrote:
This is a bit of forboding. I'm sure BA's three new transatlantic routes won't help.

The October numbers showed United's consolidated traffic for October rose only 0.6 percent year over year. Domestic traffic grew 2.3 percent year over year, but across the Atlantic, traffic dropped a very significant 4.9 percent year over year.

Undoubtedly, currency exchange rates have made it more expensive for Europeans to visit the United States in recent months. And Americans may be more wary of traveling to Europe because of lingering concerns about terrorism.


http://www.bizjournals.com/chicago/news ... ?ana=yahoo

I noticed fares to London dropped a lot, below a thousand dollars on UAL. Not good for the companies.
 
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TWA772LR
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Re: UA Sees Transatlantic Turning Sharply Negative

Fri Nov 11, 2016 1:40 am

mjoelnir wrote:
At the same time North Atlantic traffic stagnates at the US legacies, North Atlantic traffic at Icelandair and WOW grows in leaps and bounds. Norwegian grows its North Atlantic business and US airlines try to keep them out as far as possible. Alliances and joint ventures have killed competition between the big players. If you allow competition to be killed, the market dies or it opens up for new competitors.

With the Euro and Pound tanking, how are WOW, FI, and DY doing on the European point of sale to the US?
When wasn't America great?


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Viscount724
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Re: UA Sees Transatlantic Turning Sharply Negative

Fri Nov 11, 2016 2:22 am

ahmetdouas wrote:
I generally avoid American carriers because their planes are falling apart and have many more mechanical failures. I will not fly TATL with a 767-300ER or 757-200 when I can do so with a 77W. Only American flies new planes JFK-LHR with their 77W's.


A 7-abreast 767 with only a 1-in-7 chance of a middle seat in Y is much better than a cramped 10-abreast 777 which includes AA's new 77Ws.
 
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jaybird
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Re: UA Sees Transatlantic Turning Sharply Negative

Fri Nov 11, 2016 2:26 am

Well they must have just put a fare sale through - LAX-LON Feb 10 departure - $150 roundtrip plus $404 tax = US$554. Base from SFO for the same departure date is $286 roundtrip. Seats are available. Fares are very changeable - and a lowball fare might not stay there for a long time. And yes - to someone's point - taxes are still very high. But you need to look, and look again, and look again. NYC-LON Feb 10 departure is $101 roundtrip plus taxes. Obviously fares aren't always this low. But Feb to Europe is not a peak season. And many times if you book too far out before departure - you pay more.

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