BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 8:34 am

Waterbomber2 wrote:
Wait a minute. Where is all the point to point mantra from the BA A380 thread?
Smaller aircraft make every route possible and more profitable, wasn't it?
But at the end of the day, BA crawls back to MIA where they're running a VLA-centered operation.

Come to think of it, it looks like BA is profitable in all its VLA markets and trying to grasp at straws wherever they are sending their smaller widebodies? Ask DY how their point to point B787 strategy is working out... and that in a cheap fuel environment.


The 777 BA uses to FLL has 1 less seat than the 747 that serves MIA. This is hardly a "smaller" aircraft.

BA added an additional daily frequency to MIA so cut their 3x weekly service to the same city. An overall capacity increase of 1,350 seats per week as well as a frequency increase of 4x weekly net additional flights.

The 777 that serves FLL can now explore new markets since BA has added overall frequency and capacity to southern Florida. One thing is for certain, an A380 to FLL wouldn't (can't) work and the A380 now no longer serves MIA. So we can stop with all this nonsense on yet another thread.
 
Andy33
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 9:38 am

INFINITI329 wrote:
Was the777 the right plane for this route?


It's the only longhaul plane that BA have at their LGW base, so if the route doesn't work with a 777 then too bad for the route. The cost of qualifying LGW crew and mx staff on any alternative plane type just for one marginal route is going to kill the route stone dead anyway. Equally the cost of transferring a marginal leisure route to LHR, where the crews and mx staff are 787 qualified so a smaller plane can be used, will kill it stone dead. just the same. Really all these BA LGW longhaul flights are designed for UK residents on leisure breaks of some sort, a lot of seats are block-booked by tour operators or sold by British Airways Holidays, if any seats can be sold to customers at the far end of the route so much the better, but they don't rely on this.
 
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LAX772LR
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 9:41 am

INFINITI329 wrote:
Was the777 the right plane for this route?

Something of a moot question, seeing as it's the only aircraft from their LGW gateway capable of flying the route.
I myself, suspect a more prosaic motive... ~Thranduil
 
OB1504
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 11:53 am

Waterbomber2 wrote:
Wait a minute. Where is all the point to point mantra from the BA A380 thread?
Smaller aircraft make every route possible and more profitable, wasn't it?
But at the end of the day, BA crawls back to MIA where they're running a VLA-centered operation.

Come to think of it, it looks like BA is profitable in all its VLA markets and trying to grasp at straws wherever they are sending their smaller widebodies? Ask DY how their point to point B787 strategy is working out... and that in a cheap fuel environment.


"Crawls back"? It was clear from the start that BA only started the route because of Norwegian. Now that they've successfully pushed Norwegian to MIA, there's no need for them to keep FLL open as a station when MIA is 20 miles away. MIA and FLL effectively serve the same market (as do LHR and LGW) so it's hardly a failure of a point-to-point route.
 
jasoncrh
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 12:30 pm

Actually, BA and all carriers in the US do submit load factor information to the US government. It’s the t100 survey. They don’t do it for individual flights, but in a market where’s just one flight, like fll-lgw, it’s obvious what their information is for. Again, this is a reporting requirement, to the US DOT’s bureau of Transportstion statistics, and yes, BA and all foreign and domestic carriers do comply with it. And it’s accurate.


quote="BA777FO"]
SonaSounds wrote:
BA777FO wrote:

To be fair, FLL seemed to always get a decent Club load, 216 seats in economy, or 252 with the densified aircraft, was just a bit overkill. They've been flying the 4 class but sold as 3 class a few times a week lately.

They don't need 80%-90%+ load factors to break even. With the LGW cost base they could be profitable at 60% load factors but with scarce resources, and BA never seems to have enough aircraft, they could be deployed elsewhere more profitably. It was the same with the African routes like Lusaka, Dar Es Salam and Entebbe - they were profitable, but there were more profitable places to fly a 787 than there.

It was a knee jerk reaction to Norwegian. But given Norwegian no longer flies to FLL or OAK it's been successful - they pushed Norwegian into higher cost airports where BA has a real stronghold in the London market, especially Miami. I think BA is determined to not let Norwegian do in longhaul what easyjet in shorthaul. So far, so good as far as they're concerned.


I would argue that these routes do need +80% LF to be viable. Pulling some data, BA at FLL averaged a 0.06 yield in 2017 while OAK averaged a 0.07. BA at MIA consequently averaged 0.15 and 0.23 at SFO. Rough calculations put needed load factor in economy and premium to be 86.3% average for FLL to break even if they were incurring average costs. I could be off some by a few percentage not knowing their exact numbers, but it is safe to say they would need an +80% load factor to break even as I stated earlier. Yields are ~250% higher at MIA vs FLL and ~330% better at SFO vs OAK.

It is true you do not need 80%-90% load factors to break even on every route. If business traffic is good and there are high yields, you can make plenty of money on half-filled planes. But FLL is much more a leisure destination than business. Yield numbers directly correlate with profitability and they don't lie.


I'm not sure where you got those yield figures from but BA doesn't publish those publicly, not even to government agencies so I'd take those figures with a pinch of salt. In addition, that a route would need an 80-85% loadfactor to just breakeven it'd never leave the network planning stage, it'd never meet approval. BA's overall loadfactor (which I appreciate varies considerably from route to route) is ~81% - for a route to need to do better than average just to breakeven would never see the light of day. And that BA is making a ~15% operating margin on an 80% loadfactor shows where the typical breakeven loadfactor is, especially so when the shorthaul breakeven loadfactor is higher than the longhaul breakeven loadfactor.

Also I don't think it's quite appreciated how low cost the Gatwick base is. Crew are very cheap, aircraft are paid for and in the densified configuration have a lower unit cost than Norwegian's 787s, below-the-wing activity is outsourced very competitively and fees for using Gatwick are much cheaper than Heathrow.

FLL may be a leisure destination, as are most, if not all, of Gatwick's longhaul routes. They are among some of the most profitable routes on the network though! Leisure doesn't necessarily equate to cheap, especially when the Club cabin is consistently filled. Barbados is predominantly leisure but commands very high yields. Don't read too much into that, especially from Gatwick.

There are various factora at play - BA is desperately short of longhaul airframes - the 787 engine issues are still affecting 2 or 3 airframes into summer 2020, BA has just added a 3rd daily Miami and AA is upping theirs to make it 5xdaily across the JBA this summer. That allows an airframe to be freed up as the densification of the LGW RR 777s takes place. It also pushed Norwegian into BA/AA's stronghold where 5xdaily flights allows BA/AA to control the pricing on the route without materially affecting their bottom line. With over 1,500 seats compared to Norwegian's ~300 it's clear to see who's in the driving seat.[/quote]
 
Cunard
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 1:02 pm

Jasoncrh

Absolutely excellent post, you have explained the situation with such clarity :-)
94 Countries, 327 Destinations Worldwide, 32 Airlines, 29 Aircraft Types, 182 Airports, 335 Flights.
 
airbazar
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 1:46 pm

BA777FO wrote:
airbazar wrote:
BA777FO wrote:
It's served a purpose, Norwegian has now moved to a higher cost airport in Miami and San Francisco, where BA/AA are very strong - 5xdaily London to Miami and 2xdaily SFO including a daily A380. That'll be a tough environment for Norwegian to make money in.

They way I look at it is the other way around. It backfired and brought DY's lower fares to MIA and SFO, which now BA and AA have to match at least in part. Every time you invite a LCC to setup camp at your airport it's bad news.


Except BA/AA have so much capacity into MIA they can do better than Norwegian's fares and still make a profit on the remaining capacity.

This is what happened in Chicago - Norwegian started, BA put an A380 on it and dumped capacity in addition to their daily 747 and AA's 4 daily flights. Norwegian had to make it seasonal rather than year round. Same with Austin. It was on a 787-9, BA responded to Norwegian by putting a 747 on the route. Norwegian is now seasonal only to Austin. BA has gone double daily to Seattle, maintained the 747 into Denver and put pressure on Norwegian everywhere, going daily with the A380 into Boston this summer.

This plays right into BA's hands, and BA has two successes already with Austin and Chicago and seen them off of Singapore. Norwegian will find it tough going to Rio and has no real foothold in any market ex-London up against BA/AA.


Your answer is typical but it doesn't line up with reality. If having so much capacity and such a huge presence in a market was such an advantage then why does BA feel the need to respond to every move DY makes? It seems to me that the brass at BA feels more threatened by DY than you give them credit.
BOS-LON fares took a huge tumble ever since DY entered the market despite BA having 4 daily at peak. Flooding the market with cheap discounted Y fares is not a very good recipe for long term success, especially for a full service carrier like BA.
Like I said before, every time you invite a LCC to come into your territory its bad news for the "legacy" carrier. I would be shocked if there is a single BA executive that sees DY's move from FLL to MIA as a good thing.
 
usflyer msp
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 2:06 pm

I've had the opportunity to connect to the FLL-LGW flight a few times and I always declined to the lack of a lounge in FLL. No way I'm spending a 3 hour layover amongst the riffraff - especially in hot area like Florida.
 
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Miami
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 3:13 pm

BA777FO wrote:
the A380 now no longer serves MIA.

Let me correct you on that. The A380 is seasonal service. Went back to 3x daily 747 little over a week or so ago.
Aviation is proof that given, the will, we have the capacity to achieve the impossible. - Eddie Rickenbacker
 
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mooseofspruce
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 5:54 pm

BA777FO wrote:
This is what happened in Chicago - Norwegian started, BA put an A380 on it and dumped capacity in addition to their daily 747 and AA's 4 daily flights. Norwegian had to make it seasonal rather than year round. Same with Austin. It was on a 787-9, BA responded to Norwegian by putting a 747 on the route. Norwegian is now seasonal only to Austin. BA has gone double daily to Seattle, maintained the 747 into Denver and put pressure on Norwegian everywhere, going daily with the A380 into Boston this summer.

This plays right into BA's hands, and BA has two successes already with Austin and Chicago and seen them off of Singapore. Norwegian will find it tough going to Rio and has no real foothold in any market ex-London up against BA/AA.

ORD was never seasonal for DY; it even increased to daily last summer before the service began, before it reduced to 4-weekly in winter and into this summer, when a 4-weekly ORD-BCN will be added (in WOW's vacated gate times). You may be thinking of DL/VS, whose LHR-ORD was cut completely after previously being seasonal.

SEA and AUS yes.

SIN will have been various factors not exclusive to BA, including the lost cargo contract, SQ, and the ME3.

DEN in comparison at least operates to LGW year-round with an additional 3 weekly CDG in the summer (up from 2 weekly when it began last summer, before being cut for winter).

eurotrader85 wrote:
I thought Austin was upgraded just because the route did better than BA were expecting, and has since given them the confidence to explore other 'second cities'?

Dumping capacity and depressing yields doesn't seem like a BA long-term plan, especially after turning their nose up at the A380 for the 779 on the recent WB order. LON-JFK is dominated by BA, but DY have made a very good niche out of LGW-JFK going double daily. BOS, SEA, SIN, SFO, ORD, they are all premium heavy routes which DY was always going to struggle against. As you say, BA can chase the J and dump a bit of Y, which is what DY needs to stay afloat. Seems to me both airlines just found there wasn't enough Pax going to FLL and its more cost effective and easier to market going through MIA. Inevitable this one would fail IMO.

Only thing I'd add is that DY has added a third LGW-JFK flight on every day that isn't Wednesday for 20-weekly for the summer, with the 21st weekly on Wednesday loaded from winter.
I saw a flock of Moosen! Many much moosen! Out in the woods, in the wood-es, in the woodsen!
 
skipness1E
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 6:37 pm

usflyer msp wrote:
I've had the opportunity to connect to the FLL-LGW flight a few times and I always declined to the lack of a lounge in FLL. No way I'm spending a 3 hour layover amongst the riffraff - especially in hot area like Florida.

What delightful irony. Oh wait, you were being serious?
 
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LAX772LR
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 9:45 pm

jasoncrh wrote:
Barbados is predominantly leisure but commands very high yields.

To put it lightly.

Heck, as many of you know, it was so dang high-yielding that BA flew scheduled Concorde service there all the way up to retirement... and they've positioned a retired such ship in Barbados to commemorate that.
I myself, suspect a more prosaic motive... ~Thranduil
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 10:08 pm

jasoncrh wrote:
Actually, BA and all carriers in the US do submit load factor information to the US government. It’s the t100 survey. They don’t do it for individual flights, but in a market where’s just one flight, like fll-lgw, it’s obvious what their information is for. Again, this is a reporting requirement, to the US DOT’s bureau of Transportstion statistics, and yes, BA and all foreign and domestic carriers do comply with it. And it’s accurate.


Load factors yes. I stated that yields are not made available. I did make that clear in my post.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 10:17 pm

airbazar wrote:
BA777FO wrote:
airbazar wrote:
They way I look at it is the other way around. It backfired and brought DY's lower fares to MIA and SFO, which now BA and AA have to match at least in part. Every time you invite a LCC to setup camp at your airport it's bad news.


Except BA/AA have so much capacity into MIA they can do better than Norwegian's fares and still make a profit on the remaining capacity.

This is what happened in Chicago - Norwegian started, BA put an A380 on it and dumped capacity in addition to their daily 747 and AA's 4 daily flights. Norwegian had to make it seasonal rather than year round. Same with Austin. It was on a 787-9, BA responded to Norwegian by putting a 747 on the route. Norwegian is now seasonal only to Austin. BA has gone double daily to Seattle, maintained the 747 into Denver and put pressure on Norwegian everywhere, going daily with the A380 into Boston this summer.

This plays right into BA's hands, and BA has two successes already with Austin and Chicago and seen them off of Singapore. Norwegian will find it tough going to Rio and has no real foothold in any market ex-London up against BA/AA.


Your answer is typical but it doesn't line up with reality. If having so much capacity and such a huge presence in a market was such an advantage then why does BA feel the need to respond to every move DY makes? It seems to me that the brass at BA feels more threatened by DY than you give them credit.
BOS-LON fares took a huge tumble ever since DY entered the market despite BA having 4 daily at peak. Flooding the market with cheap discounted Y fares is not a very good recipe for long term success, especially for a full service carrier like BA.
Like I said before, every time you invite a LCC to come into your territory its bad news for the "legacy" carrier. I would be shocked if there is a single BA executive that sees DY's move from FLL to MIA as a good thing.


It's simple: BA can put a 777 into a market that Norwegian flies to from LGW with a densified 777 from their LGW base at a lower unit cost than Norwegian can do it. Push them into a higher cost base operating from Miami and San Francisco. At Miami, BA has more than double Norwegian's available Y seats across 2 extra frequencies. Add in the JBA seats with AA and you're looking at nearly 4 times as many seats across 4 extra frequencies. BA and AA can sustain a hit to 20/25% of those Y fares longer than Norwegian can take a hit on 100% of theirs with very little cost advantage.

Why respond to every move? They learned their lesson from easyJet 20 years ago. They won't make the same mistake again.
 
VS11
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 10:29 pm

BA777FO wrote:
airbazar wrote:
BA777FO wrote:

Except BA/AA have so much capacity into MIA they can do better than Norwegian's fares and still make a profit on the remaining capacity.

This is what happened in Chicago - Norwegian started, BA put an A380 on it and dumped capacity in addition to their daily 747 and AA's 4 daily flights. Norwegian had to make it seasonal rather than year round. Same with Austin. It was on a 787-9, BA responded to Norwegian by putting a 747 on the route. Norwegian is now seasonal only to Austin. BA has gone double daily to Seattle, maintained the 747 into Denver and put pressure on Norwegian everywhere, going daily with the A380 into Boston this summer.

This plays right into BA's hands, and BA has two successes already with Austin and Chicago and seen them off of Singapore. Norwegian will find it tough going to Rio and has no real foothold in any market ex-London up against BA/AA.


Your answer is typical but it doesn't line up with reality. If having so much capacity and such a huge presence in a market was such an advantage then why does BA feel the need to respond to every move DY makes? It seems to me that the brass at BA feels more threatened by DY than you give them credit.
BOS-LON fares took a huge tumble ever since DY entered the market despite BA having 4 daily at peak. Flooding the market with cheap discounted Y fares is not a very good recipe for long term success, especially for a full service carrier like BA.
Like I said before, every time you invite a LCC to come into your territory its bad news for the "legacy" carrier. I would be shocked if there is a single BA executive that sees DY's move from FLL to MIA as a good thing.


It's simple: BA can put a 777 into a market that Norwegian flies to from LGW with a densified 777 from their LGW base at a lower unit cost than Norwegian can do it. Push them into a higher cost base operating from Miami and San Francisco. At Miami, BA has more than double Norwegian's available Y seats across 2 extra frequencies. Add in the JBA seats with AA and you're looking at nearly 4 times as many seats across 4 extra frequencies. BA and AA can sustain a hit to 20/25% of those Y fares longer than Norwegian can take a hit on 100% of theirs with very little cost advantage.

Why respond to every move? They learned their lesson from easyJet 20 years ago. They won't make the same mistake again.


I don’t think your argument is very convincing, First Officer. Right now, Norwegian is causing BA to drop fares in key US markets. I booked a return JFK-LHR for Memorial Day weekend for less than $500. I know the pound is cheap currently but this is an insane fare for almost summer. If BA caused Norwegian to drop altogether South Florida flights, it would have been a win for BA. Having a lower cost competitor on your bread-earning markets is not a great idea - plenty of examples for that e.g. Mint on jetBlue on transcontinental. The more likely outcome is that Norwegian will re-introduce the FLL flight and keep MIA, if aircraft are available.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 10:33 pm

Miami wrote:
BA777FO wrote:
the A380 now no longer serves MIA.

Let me correct you on that. The A380 is seasonal service. Went back to 3x daily 747 little over a week or so ago.


Like I said, and you've just repeated, it's 3x daily 747 this summer and therefore no A380. Winter 2020 won't be finalised for a several months yet.
 
sealevel
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 10:47 pm

Lived there, done that, FLL vs MIA ? Will always pick FLL for north-south-west convenience. MIA ? was good for spotting
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 11:32 pm

mooseofspruce wrote:
BA777FO wrote:
This is what happened in Chicago - Norwegian started, BA put an A380 on it and dumped capacity in addition to their daily 747 and AA's 4 daily flights. Norwegian had to make it seasonal rather than year round. Same with Austin. It was on a 787-9, BA responded to Norwegian by putting a 747 on the route. Norwegian is now seasonal only to Austin. BA has gone double daily to Seattle, maintained the 747 into Denver and put pressure on Norwegian everywhere, going daily with the A380 into Boston this summer.

This plays right into BA's hands, and BA has two successes already with Austin and Chicago and seen them off of Singapore. Norwegian will find it tough going to Rio and has no real foothold in any market ex-London up against BA/AA.

ORD was never seasonal for DY; it even increased to daily last summer before the service began, before it reduced to 4-weekly in winter and into this summer, when a 4-weekly ORD-BCN will be added (in WOW's vacated gate times). You may be thinking of DL/VS, whose LHR-ORD was cut completely after previously being seasonal.

SEA and AUS yes.

SIN will have been various factors not exclusive to BA, including the lost cargo contract, SQ, and the ME3.

DEN in comparison at least operates to LGW year-round with an additional 3 weekly CDG in the summer (up from 2 weekly when it began last summer, before being cut for winter).


Thanks for clarifying ORD - I was under the impression they cut LGW-ORD for winter but perhaps it was the reduction you mention. You're right about SIN, there were various factors at play but it just shows that they're struggling to differentiate in mature markets with big players on the route. AUS going to the 747 and SEA double daily shows that even the perennial oil tanker that is BA is flexible enough to be nimble to the threat. This is a new BA, not the one of pre-2008.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 11:36 pm

VS11 wrote:
BA777FO wrote:
airbazar wrote:

Your answer is typical but it doesn't line up with reality. If having so much capacity and such a huge presence in a market was such an advantage then why does BA feel the need to respond to every move DY makes? It seems to me that the brass at BA feels more threatened by DY than you give them credit.
BOS-LON fares took a huge tumble ever since DY entered the market despite BA having 4 daily at peak. Flooding the market with cheap discounted Y fares is not a very good recipe for long term success, especially for a full service carrier like BA.
Like I said before, every time you invite a LCC to come into your territory its bad news for the "legacy" carrier. I would be shocked if there is a single BA executive that sees DY's move from FLL to MIA as a good thing.


It's simple: BA can put a 777 into a market that Norwegian flies to from LGW with a densified 777 from their LGW base at a lower unit cost than Norwegian can do it. Push them into a higher cost base operating from Miami and San Francisco. At Miami, BA has more than double Norwegian's available Y seats across 2 extra frequencies. Add in the JBA seats with AA and you're looking at nearly 4 times as many seats across 4 extra frequencies. BA and AA can sustain a hit to 20/25% of those Y fares longer than Norwegian can take a hit on 100% of theirs with very little cost advantage.

Why respond to every move? They learned their lesson from easyJet 20 years ago. They won't make the same mistake again.


I don’t think your argument is very convincing, First Officer. Right now, Norwegian is causing BA to drop fares in key US markets. I booked a return JFK-LHR for Memorial Day weekend for less than $500. I know the pound is cheap currently but this is an insane fare for almost summer. If BA caused Norwegian to drop altogether South Florida flights, it would have been a win for BA. Having a lower cost competitor on your bread-earning markets is not a great idea - plenty of examples for that e.g. Mint on jetBlue on transcontinental. The more likely outcome is that Norwegian will re-introduce the FLL flight and keep MIA, if aircraft are available.


I'm glad you managed to get a bargain. But the point us, with 8+ daily flights from LON-NYC plus AA's flights, AA/BA can afford to take a loss on ~300Y seats over the many flights and still turn a profit. If Norwegian makes a loss on 300Y seats the entire flight makes a loss for them.

I bet Norwegian doesn't reintroduce FLL from LGW. They publicly stated that the move to MIA was in search of higher yields. Guess who managed to depress Norwegian's yields to FLL? I'd consider this a big success. Now Norwegian has to compete with 5 daily flights rather than 3 per week and BA's tolerance for reduced fares, with an operating margin of 14%, is considerably higher than Norwegian, which hasn't turned an annual profit in how long?
 
MalevA346
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Re: British Airways cancels Fort Lauderdale service

Sat Apr 27, 2019 11:51 pm

The most precious crown jewel of any airline in the world should be protected even with the highest sacrifices. :) Old school longest term conservative strategic management at its best. Nice to see such a straight example, rare in aviation history..
 
VS11
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 12:43 am

BA777FO wrote:
VS11 wrote:
BA777FO wrote:

It's simple: BA can put a 777 into a market that Norwegian flies to from LGW with a densified 777 from their LGW base at a lower unit cost than Norwegian can do it. Push them into a higher cost base operating from Miami and San Francisco. At Miami, BA has more than double Norwegian's available Y seats across 2 extra frequencies. Add in the JBA seats with AA and you're looking at nearly 4 times as many seats across 4 extra frequencies. BA and AA can sustain a hit to 20/25% of those Y fares longer than Norwegian can take a hit on 100% of theirs with very little cost advantage.

Why respond to every move? They learned their lesson from easyJet 20 years ago. They won't make the same mistake again.


I don’t think your argument is very convincing, First Officer. Right now, Norwegian is causing BA to drop fares in key US markets. I booked a return JFK-LHR for Memorial Day weekend for less than $500. I know the pound is cheap currently but this is an insane fare for almost summer. If BA caused Norwegian to drop altogether South Florida flights, it would have been a win for BA. Having a lower cost competitor on your bread-earning markets is not a great idea - plenty of examples for that e.g. Mint on jetBlue on transcontinental. The more likely outcome is that Norwegian will re-introduce the FLL flight and keep MIA, if aircraft are available.


I'm glad you managed to get a bargain. But the point us, with 8+ daily flights from LON-NYC plus AA's flights, AA/BA can afford to take a loss on ~300Y seats over the many flights and still turn a profit. If Norwegian makes a loss on 300Y seats the entire flight makes a loss for them.

I bet Norwegian doesn't reintroduce FLL from LGW. They publicly stated that the move to MIA was in search of higher yields. Guess who managed to depress Norwegian's yields to FLL? I'd consider this a big success. Now Norwegian has to compete with 5 daily flights rather than 3 per week and BA's tolerance for reduced fares, with an operating margin of 14%, is considerably higher than Norwegian, which hasn't turned an annual profit in how long?


I agree that IAG took Norwegian very seriously and BA’s response to throw cheap capacity was not stupid but the reality is that If you search now on kayak for Memorial Day weekend - just less than a month away - NYC-LON, the cheapest options are still AA/BA at $517 while Norwegian is at $680. I am happy AA/BA have found a way to defend their market share but Norwegian is not gone and is getting higher fares. Meanwhile, two of the competitors are gone giving Norwegian more breathing room.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 1:53 am

BA can sell ~600 seats cheaper than Norwegian and still has 1,000+ more seats per day to sell at higher prices. If Norwegian matches BA on those 600 seats then Norwegian has no more seats to sell at a profit. BA has exceptional pricing power in the market.

Notice also how the cheapest BA fare to NYC is from Gatwick. BA's LGW 777s have a lower unit cost than Norwegian's 787s so BA can sell at a lower price and still make money. It's a perfect spoiler to Norwegian and is working well.

Have you seen the J fares though? £4,200 return that weekend. On a hi-J 747 that's ~£360,000 worth of revenue from that cabin alone round trip. That cabin alone probably generates more revenue than Norwegian's entire 787. BA can take the hit and still make a tidy profit, which with a network-wide margin of 14+% they are. Norwegian, however, continues to post losses. BA has this one sussed out.
 
VS11
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 2:09 am

BA777FO wrote:
BA can sell ~600 seats cheaper than Norwegian and still has 1,000+ more seats per day to sell at higher prices. If Norwegian matches BA on those 600 seats then Norwegian has no more seats to sell at a profit. BA has exceptional pricing power in the market.

Notice also how the cheapest BA fare to NYC is from Gatwick. BA's LGW 777s have a lower unit cost than Norwegian's 787s so BA can sell at a lower price and still make money. It's a perfect spoiler to Norwegian and is working well.

Have you seen the J fares though? £4,200 return that weekend. On a hi-J 747 that's ~£360,000 worth of revenue from that cabin alone round trip. That cabin alone probably generates more revenue than Norwegian's entire 787. BA can take the hit and still make a tidy profit, which with a network-wide margin of 14+% they are. Norwegian, however, continues to post losses. BA has this one sussed out.


But Norwegian’s fares were marginally lower, almost the same, than BA’s about 10 days ago. Now they are higher than BA’s. Norwegian does not need to match BA’s fares as Norwegian’s are growing. BA’s capacity does not seem to be impacting Norwegian’s ability to raise fares.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 2:27 am

It may well be that Norwegian has already sold most of its capacity at a loss. Or they're simply not selling at the higher fares. We don't know for sure. But while BA powers along with nearly a £2bn operating profit and 14% margins Norwegian stilk can't turn a profit.

They're financing 787s at high costs, they have no utilisation advantage, only a tiny fuel saving (although BA has a good hedged position for the next 12 quarters) and very little in the way of cheaper crew costs. BA is turning the screw with its ability to match or better Norwegian's fares in its core markets from LGW.

I get people willing on the underdog and wanting Norwegian to succeed but it's a failing business model that hasn't delivered and in reality is unlikely to.
 
VS11
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 2:51 am

BA777FO wrote:
It may well be that Norwegian has already sold most of its capacity at a loss. Or they're simply not selling at the higher fares. We don't know for sure. But while BA powers along with nearly a £2bn operating profit and 14% margins Norwegian stilk can't turn a profit.

They're financing 787s at high costs, they have no utilisation advantage, only a tiny fuel saving (although BA has a good hedged position for the next 12 quarters) and very little in the way of cheaper crew costs. BA is turning the screw with its ability to match or better Norwegian's fares in its core markets from LGW.

I get people willing on the underdog and wanting Norwegian to succeed but it's a failing business model that hasn't delivered and in reality is unlikely to.


Well, it is not really fair to compare Norwegian to BA. Very different stories. As to their model, IAG’s own CEO said Norwegian proved the TATL low cost model worked. I am sure you know IAG made a bid for Norwegian and even had a small stake in it.

The point is that BA’s moves against Norwegian have had limited effectiveness. Fares have dropped and Norwegian is managing to raise them faster than BA, and relating to FLL, not only has Norwegian not gone away but they actually encroached further on the dominant BA/AA market share in Miami.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 3:02 am

We'll have to agree to disagree. IAG saw Norwegian as a threat and a takeover was a way of eliminating that. That it wasn't pursued reveals more about the state Norwegian finds itself in more than anything else. IAG is ready to pick up the pieces it wants later than take the whole mess now.

Hardly limited effectiveness though. Norwegian has been pretty much run out of Austin and Seattle. Singapore was a disaster, and now they're moving into higher cost airports at SFO and MIA where BA can set.the pricing agenda. As I've said before, given the LGW cost base, the 777 has a lower unit cost than Norwegian's 787s so a lower fare hurts Norwegian more than it does BA. If Norwegian is pitching itself as more expensive than BA then it will find life very tough indeed. There is virtually no market that Norwegian can have a material affect on BA if BA plays it right.

Like I said, when you generate more revenue from your business class cabin alone than Norwegian is likely able to do from its entire aircraft, BA's strategy is paying dividends. Norwegian has said its move to SFO and MIA is in search for higher yields. When BA can set the price at a similar level to what FLL was commanding then Norwegian is just adding cost without extra revenue. The writing is on the wall.
 
Waterbomber2
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 3:33 am

BA777FO wrote:
It may well be that Norwegian has already sold most of its capacity at a loss. Or they're simply not selling at the higher fares. We don't know for sure. But while BA powers along with nearly a £2bn operating profit and 14% margins Norwegian stilk can't turn a profit.

They're financing 787s at high costs, they have no utilisation advantage, only a tiny fuel saving (although BA has a good hedged position for the next 12 quarters) and very little in the way of cheaper crew costs. BA is turning the screw with its ability to match or better Norwegian's fares in its core markets from LGW.

I get people willing on the underdog and wanting Norwegian to succeed but it's a failing business model that hasn't delivered and in reality is unlikely to.


Forget the tiny unit cost details etc...
BA is a network carrier with one of the largest hubs at one of the most desirable airports in the world. They have a big nest at one of the most desirable spots and that alone is what is saving the day and bringing in the profits; nothing more.
DY is a carrier that flies point to point routes from everywhere to everywhere else and is getting no-where.

If BA is doing anything, they are trying very hard to become a DY.
Declining product, pay for everything, poor connecting timings and facilities, smaller aircraft to replace larger aircraft to improve unit margin rather than increase market share, meaninglessly opening routes from LGW.
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.
 
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aemoreira1981
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 4:00 am

eta unknown wrote:
Well Norwegian just transferred their LGW-FLL fligtht to MIA last month...


This is a headscratcher. FLL is basically the low-cost airport for South Florida (although Emirates operates to FLL instead of MIA for B6 feed). I have to wonder if BY might fly LGW-FLL.
 
OB1504
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 4:54 am

usflyer msp wrote:
I've had the opportunity to connect to the FLL-LGW flight a few times and I always declined to the lack of a lounge in FLL. No way I'm spending a 3 hour layover amongst the riffraff - especially in hot area like Florida.


You do realize that the terminals are indoors and air conditioned?
 
skipness1E
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 10:36 am

Waterbomber2 wrote:
BA777FO wrote:
It may well be that Norwegian has already sold most of its capacity at a loss. Or they're simply not selling at the higher fares. We don't know for sure. But while BA powers along with nearly a £2bn operating profit and 14% margins Norwegian stilk can't turn a profit.

They're financing 787s at high costs, they have no utilisation advantage, only a tiny fuel saving (although BA has a good hedged position for the next 12 quarters) and very little in the way of cheaper crew costs. BA is turning the screw with its ability to match or better Norwegian's fares in its core markets from LGW.

I get people willing on the underdog and wanting Norwegian to succeed but it's a failing business model that hasn't delivered and in reality is unlikely to.


Forget the tiny unit cost details etc...
BA is a network carrier with one of the largest hubs at one of the most desirable airports in the world. They have a big nest at one of the most desirable spots and that alone is what is saving the day and bringing in the profits; nothing more.
DY is a carrier that flies point to point routes from everywhere to everywhere else and is getting no-where.

If BA is doing anything, they are trying very hard to become a DY.
Declining product, pay for everything, poor connecting timings and facilities, smaller aircraft to replace larger aircraft to improve unit margin rather than increase market share, meaninglessly opening routes from LGW.
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.

Wrong, wrong, wrong, that’s so 1990s.
BA worked hard to make LGW profitable not just once but consistently year in year out. LGW long haul does rather well, so your description of “Meaninglessly opening routes from LGW” is better described as part of the larger strategy to keep BA relevant in markets DY are getting into. But at the end of the day BA LGW makes money in it’s own right, BA is not all about hubbing LHR but also serves a large UK bases POS on p2p leisure out of Crawley Intl.
As for charging for everything, well that’s what makes money, sad but true. If you want more, pony up for cabins nearer the pointy end.
 
BA777FO
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 8:07 pm

Waterbomber2 wrote:
Forget the tiny unit cost details etc...
BA is a network carrier with one of the largest hubs at one of the most desirable airports in the world. They have a big nest at one of the most desirable spots and that alone is what is saving the day and bringing in the profits; nothing more.
DY is a carrier that flies point to point routes from everywhere to everywhere else and is getting no-where.


That "tiny unit cost" detail is what enables BA to sell seats at a lower price than Norwegian and still make money. It's not a tiny detail, it's a major part of the equation. We finally agree that Norwegian isn't getting anywhere with their strategy though, largely because BA runs a better network with a lower unit cost. That's hard to compete with.

Waterbomber2 wrote:
If BA is doing anything, they are trying very hard to become a DY.
Declining product, pay for everything, poor connecting timings and facilities, smaller aircraft to replace larger aircraft to improve unit margin rather than increase market share, meaninglessly opening routes from LGW.


BA is trying to become Norwegian?! BA has, since 2008 and the end of Bermuda II, operated a premium, point-to-point longhaul leisure product from LGW. The aircraft are being refreshed, there'll be a new J seat, there are new W and Y seats, increased and improved catering, a new lounge (if we're talking about LGW here) and growth through ex-Monarch slots actually means there are several more connecting opportunities at better times. Pay for everything? No, Club Europe is an an all-inclusive fare on short haul and the only extras charged for on long haul are wifi, and if you're not a Silver or Gold card holder, seat reservations beyond 24 hours prior to departure. Smaller aircraft? 777-200s are being replaced by 77Ws, A350s are essentially the same capacity as the 747s, 777Xs will have greater capacity than many aircraft it replaces, A321 and A320neos are replacing A319s...you're flat out wrong.

Meaninglessly open routes from LGW? Norwegian no longer flies to OAK or FLL. Job done.

Waterbomber2 wrote:
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.


You do realise that by eliminating FLL but adding a 3rd daily flight to MIA, BA has increased frequency by 4 services per week and added 1,350 seats per week. They are growing MIA, as you suggest. They're also adding an additional weekly flight to Orlando this summer as well as two extra weekly flights to each of CUN and LAS and extra frequencies to KIN and YYZ.

I'm not sure what your gripe is?!
 
LAXLHR
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 8:15 pm

davidjohnson6 wrote:
I'm surprised BA waited this long to cancel FLL aftee Norwegian moved to Miami. I suppose it would have looked suspicious if BA cancelled FLL the day after Norwegian stopped FLL though...


It STILL looks suspicious!
BA IB ET JM EA GK PA VS AA SN HP CO W7 WN NW DL UA AC US LH LX OS JL QF QR WY MH CX U2 EK 9W UK TP VY VN LO OK OZ UL SQ LA

707 727 L10 732-NG 741 742 743 744 752 753 762 763 772 773 787 DC8 DC9 DC10 M80 M11 100 AB3 310 318 319 320 321 332 333 342 343 380
 
Murdoughnut
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 8:35 pm

Word on the street is that FLL management asked some carriers to either move or temporarily cease international operations for a period of time to accommodate construction. Strangely enough, being told "we'd prefer you not operate here" doesn't work out so well as an air service strategy. What you get with county/municipally run airports, though.

"Bold strategy Cotton - let's see if it pays off"
 
Waterbomber2
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 11:34 pm

skipness1E wrote:
Waterbomber2 wrote:
BA777FO wrote:
It may well be that Norwegian has already sold most of its capacity at a loss. Or they're simply not selling at the higher fares. We don't know for sure. But while BA powers along with nearly a £2bn operating profit and 14% margins Norwegian stilk can't turn a profit.

They're financing 787s at high costs, they have no utilisation advantage, only a tiny fuel saving (although BA has a good hedged position for the next 12 quarters) and very little in the way of cheaper crew costs. BA is turning the screw with its ability to match or better Norwegian's fares in its core markets from LGW.

I get people willing on the underdog and wanting Norwegian to succeed but it's a failing business model that hasn't delivered and in reality is unlikely to.


Forget the tiny unit cost details etc...
BA is a network carrier with one of the largest hubs at one of the most desirable airports in the world. They have a big nest at one of the most desirable spots and that alone is what is saving the day and bringing in the profits; nothing more.
DY is a carrier that flies point to point routes from everywhere to everywhere else and is getting no-where.

If BA is doing anything, they are trying very hard to become a DY.
Declining product, pay for everything, poor connecting timings and facilities, smaller aircraft to replace larger aircraft to improve unit margin rather than increase market share, meaninglessly opening routes from LGW.
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.


Wrong, wrong, wrong, that’s so 1990s.
BA worked hard to make LGW profitable not just once but consistently year in year out. LGW long haul does rather well, so your description of “Meaninglessly opening routes from LGW” is better described as part of the larger strategy to keep BA relevant in markets DY are getting into. But at the end of the day BA LGW makes money in it’s own right, BA is not all about hubbing LHR but also serves a large UK bases POS on p2p leisure out of Crawley Intl.
As for charging for everything, well that’s what makes money, sad but true. If you want more, pony up for cabins nearer the pointy end.


I think that you are wrong. There is no evidence to suggest that LGW is profitable or that it isn't.
Looking at their route network though, it's certain that they will be profitable in the summer but rather doubtful that they are profitable all-year round.
In the aftermath of Monarch's insolvency, obviously BA is going to see a spike, but it has nothing to do with what they're doing right.

Adding fees right and left works for a summer or two, but after that you enter a steady decline.
JAL is half the airline BA is in terms of fleet, has hubs divided over two airports, the highest maintenance cost base in the world, low aircraft utilisation, doesn't charge extra for anything, gives away great toothbrushes, has a generous loyalty program and a very good product throughout all classes, and yet their earnings are at the same level as BA.
Why?
BA is making good money, but perhaps they should be making double of what they are if they were properly managed?

I have made similar warnings about Ryanair.
Ryanair has built a new corporate office, started operating routes out of primary airports, started offering itself as a feeder for legacy airlines, charging even for the carry-on, and most importantly, increasing their fares very drastically. In the meanwhile, passengers are adapting and Ryanair is now having to actively compete against legacies that will sell better schedules and better access for just a fraction more.
Ryanair have been destroying the business model that made them so great, for short-term profits.
I have been answered with disbelief and disrespect on airliners.net when I said that they are at the top of their climb and about to start declining, but what do we see now? Ryanair is now issuing profit warning quarter after quarter, the first time in two decades, with a yield crisis brewing. I'm seeing them panic over the summer yields as I saw many high season fares being slashed by more than half in the past few weeks while they should be increasing.
The passengers aren't buying it anymore and MOL who is seeing the upcoming disaster, has promoted himself away while the stock price is melting down.

Image

https://www.ft.com/__origami/service/im ... &width=700
 
lhrsfosyd91
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Re: British Airways cancels Fort Lauderdale service

Sun Apr 28, 2019 11:43 pm

JAL cannot be compared to BA. JL benefits from much higher yields, rarely discounts seats and the Japanese pay premium to fly on Japanese metal which cannot be said about the British and BA. JAL has also large streams of revenue from their domestic operation - once again, a very different nature of operation to BA.
 
MIAFLLPBIFlyer
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 3:54 pm

sealevel wrote:
Lived there, done that, FLL vs MIA ? Will always pick FLL for north-south-west convenience. MIA ? was good for spotting


This is actually something that I am hearing more of. People living east even in Miami-Dade don't mind flying out of FLL, some actually prefer it. We think north-south & hate going east-west. If you're further west even in Broward, MIA is in many ways more convenient because it is further west.
 
Brickell305
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 4:05 pm

MIAFLLPBIFlyer wrote:
sealevel wrote:
Lived there, done that, FLL vs MIA ? Will always pick FLL for north-south-west convenience. MIA ? was good for spotting


This is actually something that I am hearing more of. People living east even in Miami-Dade don't mind flying out of FLL, some actually prefer it. We think north-south & hate going east-west. If you're further west even in Broward, MIA is in many ways more convenient because it is further west.

I agree if you live in say Pembroke Pines or Miramar, MIA might be the more convenient airport even though you're in Broward. In any event though, people from all three counties utilize both MIA and FLL to varying degrees. I think your destination, the fare, schedule and even airline loyalty determine the airport you use more than which part of South Florida you live. All things being equal, most people will choose the airport closest to/most convenient to them. However, there are always other factors at play. It's always funny to me to see people say that SAT or PHL have trouble attracting whatever level of service due to alternatives like AUS and EWR because people will drive to the alternative. However, those same people somehow think it's utterly impossible for people to drive from Davie to MIA or Coral Gables to FLL. It's quite amusing.
 
OB1504
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 4:33 pm

BA777FO wrote:
Waterbomber2 wrote:
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.


You do realise that by eliminating FLL but adding a 3rd daily flight to MIA, BA has increased frequency by 4 services per week and added 1,350 seats per week. They are growing MIA, as you suggest


They’re not really growing MIA. The 3rd BA flight replaced the 2nd AA flight so the total MIA-LHR frequencies on AA/BA didn’t change.

Murdoughnut wrote:
Word on the street is that FLL management asked some carriers to either move or temporarily cease international operations for a period of time to accommodate construction. Strangely enough, being told "we'd prefer you not operate here" doesn't work out so well as an air service strategy. What you get with county/municipally run airports, though.

"Bold strategy Cotton - let's see if it pays off"


That’s what JFK is doing for runway work as well. If the airport was privately run, would they be able to magically maintain the same level of operations while reducing the airport’s capacity?
 
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Miami
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 5:04 pm

OB1504 wrote:

They’re not really growing MIA. The 3rd BA flight replaced the 2nd AA flight so the total MIA-LHR frequencies on AA/BA didn’t change.


AA is resuming its 2nd daily MIA-LHR flight later this year. BA remains at 3 daily.
Aviation is proof that given, the will, we have the capacity to achieve the impossible. - Eddie Rickenbacker
 
Josh32121
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 5:30 pm

SierraPacific wrote:
Do Brits even like Fort Lauderdale? Miami always struck me as the much more European destination.


I don't believe FLL service was as much about the city itself as it was for its proximity to and demand generated by Port Everglades cruise port. PE is literally across Federal Highway (US-1) from the airport compared to several miles plus downtown Miami between MIA and Port Miami. But that isn't necessarily high-yielding traffic, and a lot of Euro visitors tend to add on a stopover between the cruise and their flight there or home, so using MIA and staying in Miami proper for a few days in between probably makes MIA as convenient if not more so for UK-origin travelers.
 
MIAFLLPBIFlyer
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 6:07 pm

Brickell305 wrote:
MIAFLLPBIFlyer wrote:
sealevel wrote:
Lived there, done that, FLL vs MIA ? Will always pick FLL for north-south-west convenience. MIA ? was good for spotting


This is actually something that I am hearing more of. People living east even in Miami-Dade don't mind flying out of FLL, some actually prefer it. We think north-south & hate going east-west. If you're further west even in Broward, MIA is in many ways more convenient because it is further west.

I agree if you live in say Pembroke Pines or Miramar, MIA might be the more convenient airport even though you're in Broward. In any event though, people from all three counties utilize both MIA and FLL to varying degrees. I think your destination, the fare, schedule and even airline loyalty determine the airport you use more than which part of South Florida you live. All things being equal, most people will choose the airport closest to/most convenient to them. However, there are always other factors at play. It's always funny to me to see people say that SAT or PHL have trouble attracting whatever level of service due to alternatives like AUS and EWR because people will drive to the alternative. However, those same people somehow think it's utterly impossible for people to drive from Davie to MIA or Coral Gables to FLL. It's quite amusing.


I can drive from MIA to FLL in as little as 30-35 minutes on the weekend and non-peak hours on weekdays. Of course this involves the I-95 express lanes but still it's really not very far north to south.

I do think PBI has trouble attracting service because of FLL but that's another topic for another time.
 
Murdoughnut
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 9:15 pm

OB1504 wrote:
BA777FO wrote:
Waterbomber2 wrote:
DY doesn't need any help, they are destroying themselves,so rather than going after them, BA could better invest into growing their main markets such as MIA or MCO.


You do realise that by eliminating FLL but adding a 3rd daily flight to MIA, BA has increased frequency by 4 services per week and added 1,350 seats per week. They are growing MIA, as you suggest


They’re not really growing MIA. The 3rd BA flight replaced the 2nd AA flight so the total MIA-LHR frequencies on AA/BA didn’t change.

Murdoughnut wrote:
Word on the street is that FLL management asked some carriers to either move or temporarily cease international operations for a period of time to accommodate construction. Strangely enough, being told "we'd prefer you not operate here" doesn't work out so well as an air service strategy. What you get with county/municipally run airports, though.

"Bold strategy Cotton - let's see if it pays off"


That’s what JFK is doing for runway work as well. If the airport was privately run, would they be able to magically maintain the same level of operations while reducing the airport’s capacity?


JFK doesn’t have to compete for air service. Big difference. And plenty of aviation authorities (still public, but better run) plan construction around aircraft operations
 
Brandon757
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Re: British Airways cancels Fort Lauderdale service

Mon Apr 29, 2019 9:18 pm

I always fly to FLL when I fly from DFW to go to Miami. You would think DFW-MIA would be the cheapest route, but I have always found DFW-FLL to be cheaper even on AA.
 
OB1504
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Re: British Airways cancels Fort Lauderdale service

Tue Apr 30, 2019 4:59 am

Brandon757 wrote:
I always fly to FLL when I fly from DFW to go to Miami. You would think DFW-MIA would be the cheapest route, but I have always found DFW-FLL to be cheaper even on AA.


That makes sense. They’re competing directly against Spirit on DFW-FLL. If you want the convenience of flying directly into MIA, AA charges a premium.
 
SonaSounds
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Re: British Airways cancels Fort Lauderdale service

Tue Apr 30, 2019 4:00 pm

BA777FO wrote:
SonaSounds wrote:
BA777FO wrote:

To be fair, FLL seemed to always get a decent Club load, 216 seats in economy, or 252 with the densified aircraft, was just a bit overkill. They've been flying the 4 class but sold as 3 class a few times a week lately.

They don't need 80%-90%+ load factors to break even. With the LGW cost base they could be profitable at 60% load factors but with scarce resources, and BA never seems to have enough aircraft, they could be deployed elsewhere more profitably. It was the same with the African routes like Lusaka, Dar Es Salam and Entebbe - they were profitable, but there were more profitable places to fly a 787 than there.

It was a knee jerk reaction to Norwegian. But given Norwegian no longer flies to FLL or OAK it's been successful - they pushed Norwegian into higher cost airports where BA has a real stronghold in the London market, especially Miami. I think BA is determined to not let Norwegian do in longhaul what easyjet in shorthaul. So far, so good as far as they're concerned.


I would argue that these routes do need +80% LF to be viable. Pulling some data, BA at FLL averaged a 0.06 yield in 2017 while OAK averaged a 0.07. BA at MIA consequently averaged 0.15 and 0.23 at SFO. Rough calculations put needed load factor in economy and premium to be 86.3% average for FLL to break even if they were incurring average costs. I could be off some by a few percentage not knowing their exact numbers, but it is safe to say they would need an +80% load factor to break even as I stated earlier. Yields are ~250% higher at MIA vs FLL and ~330% better at SFO vs OAK.

It is true you do not need 80%-90% load factors to break even on every route. If business traffic is good and there are high yields, you can make plenty of money on half-filled planes. But FLL is much more a leisure destination than business. Yield numbers directly correlate with profitability and they don't lie.


I'm not sure where you got those yield figures from but BA doesn't publish those publicly, not even to government agencies so I'd take those figures with a pinch of salt. In addition, that a route would need an 80-85% loadfactor to just breakeven it'd never leave the network planning stage, it'd never meet approval. BA's overall loadfactor (which I appreciate varies considerably from route to route) is ~81% - for a route to need to do better than average just to breakeven would never see the light of day. And that BA is making a ~15% operating margin on an 80% loadfactor shows where the typical breakeven loadfactor is, especially so when the shorthaul breakeven loadfactor is higher than the longhaul breakeven loadfactor.

Also I don't think it's quite appreciated how low cost the Gatwick base is. Crew are very cheap, aircraft are paid for and in the densified configuration have a lower unit cost than Norwegian's 787s, below-the-wing activity is outsourced very competitively and fees for using Gatwick are much cheaper than Heathrow.

FLL may be a leisure destination, as are most, if not all, of Gatwick's longhaul routes. They are among some of the most profitable routes on the network though! Leisure doesn't necessarily equate to cheap, especially when the Club cabin is consistently filled. Barbados is predominantly leisure but commands very high yields. Don't read too much into that, especially from Gatwick.

There are various factora at play - BA is desperately short of longhaul airframes - the 787 engine issues are still affecting 2 or 3 airframes into summer 2020, BA has just added a 3rd daily Miami and AA is upping theirs to make it 5xdaily across the JBA this summer. That allows an airframe to be freed up as the densification of the LGW RR 777s takes place. It also pushed Norwegian into BA/AA's stronghold where 5xdaily flights allows BA/AA to control the pricing on the route without materially affecting their bottom line. With over 1,500 seats compared to Norwegian's ~300 it's clear to see who's in the driving seat.



Some of us have access to systems that can give us this information, but it can also be found here if you know how to manipulate data. It does have to be published publicly in the USA and you can crunch the data by carrier at an airport to figure out these numbers: https://www.transtats.bts.gov/Tables.asp?DB_ID=111

If you have more accurate cost numbers for LGW besides "lower" I could use them in my model, but from the information I have these routes would need the load factors stated above to break even. This is not to say ALL routes from LGW need a 85%+ load factor to break even, but in this specific case, it needed somewhere north of 80%.
 
BA777FO
Posts: 349
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Re: British Airways cancels Fort Lauderdale service

Tue Apr 30, 2019 6:01 pm

SonaSounds wrote:
BA777FO wrote:
SonaSounds wrote:

I would argue that these routes do need +80% LF to be viable. Pulling some data, BA at FLL averaged a 0.06 yield in 2017 while OAK averaged a 0.07. BA at MIA consequently averaged 0.15 and 0.23 at SFO. Rough calculations put needed load factor in economy and premium to be 86.3% average for FLL to break even if they were incurring average costs. I could be off some by a few percentage not knowing their exact numbers, but it is safe to say they would need an +80% load factor to break even as I stated earlier. Yields are ~250% higher at MIA vs FLL and ~330% better at SFO vs OAK.

It is true you do not need 80%-90% load factors to break even on every route. If business traffic is good and there are high yields, you can make plenty of money on half-filled planes. But FLL is much more a leisure destination than business. Yield numbers directly correlate with profitability and they don't lie.


I'm not sure where you got those yield figures from but BA doesn't publish those publicly, not even to government agencies so I'd take those figures with a pinch of salt. In addition, that a route would need an 80-85% loadfactor to just breakeven it'd never leave the network planning stage, it'd never meet approval. BA's overall loadfactor (which I appreciate varies considerably from route to route) is ~81% - for a route to need to do better than average just to breakeven would never see the light of day. And that BA is making a ~15% operating margin on an 80% loadfactor shows where the typical breakeven loadfactor is, especially so when the shorthaul breakeven loadfactor is higher than the longhaul breakeven loadfactor.

Also I don't think it's quite appreciated how low cost the Gatwick base is. Crew are very cheap, aircraft are paid for and in the densified configuration have a lower unit cost than Norwegian's 787s, below-the-wing activity is outsourced very competitively and fees for using Gatwick are much cheaper than Heathrow.

FLL may be a leisure destination, as are most, if not all, of Gatwick's longhaul routes. They are among some of the most profitable routes on the network though! Leisure doesn't necessarily equate to cheap, especially when the Club cabin is consistently filled. Barbados is predominantly leisure but commands very high yields. Don't read too much into that, especially from Gatwick.

There are various factora at play - BA is desperately short of longhaul airframes - the 787 engine issues are still affecting 2 or 3 airframes into summer 2020, BA has just added a 3rd daily Miami and AA is upping theirs to make it 5xdaily across the JBA this summer. That allows an airframe to be freed up as the densification of the LGW RR 777s takes place. It also pushed Norwegian into BA/AA's stronghold where 5xdaily flights allows BA/AA to control the pricing on the route without materially affecting their bottom line. With over 1,500 seats compared to Norwegian's ~300 it's clear to see who's in the driving seat.



Some of us have access to systems that can give us this information, but it can also be found here if you know how to manipulate data. It does have to be published publicly in the USA and you can crunch the data by carrier at an airport to figure out these numbers: https://www.transtats.bts.gov/Tables.asp?DB_ID=111

If you have more accurate cost numbers for LGW besides "lower" I could use them in my model, but from the information I have these routes would need the load factors stated above to break even. This is not to say ALL routes from LGW need a 85%+ load factor to break even, but in this specific case, it needed somewhere north of 80%.


I'm seeing nothing that mentions revenue per passenger kilometre/mile for a particular route.
 
SonaSounds
Posts: 252
Joined: Mon Jan 09, 2017 7:16 pm

Re: British Airways cancels Fort Lauderdale service

Tue Apr 30, 2019 9:56 pm

BA777FO wrote:
SonaSounds wrote:
BA777FO wrote:

I'm not sure where you got those yield figures from but BA doesn't publish those publicly, not even to government agencies so I'd take those figures with a pinch of salt. In addition, that a route would need an 80-85% loadfactor to just breakeven it'd never leave the network planning stage, it'd never meet approval. BA's overall loadfactor (which I appreciate varies considerably from route to route) is ~81% - for a route to need to do better than average just to breakeven would never see the light of day. And that BA is making a ~15% operating margin on an 80% loadfactor shows where the typical breakeven loadfactor is, especially so when the shorthaul breakeven loadfactor is higher than the longhaul breakeven loadfactor.

Also I don't think it's quite appreciated how low cost the Gatwick base is. Crew are very cheap, aircraft are paid for and in the densified configuration have a lower unit cost than Norwegian's 787s, below-the-wing activity is outsourced very competitively and fees for using Gatwick are much cheaper than Heathrow.

FLL may be a leisure destination, as are most, if not all, of Gatwick's longhaul routes. They are among some of the most profitable routes on the network though! Leisure doesn't necessarily equate to cheap, especially when the Club cabin is consistently filled. Barbados is predominantly leisure but commands very high yields. Don't read too much into that, especially from Gatwick.

There are various factora at play - BA is desperately short of longhaul airframes - the 787 engine issues are still affecting 2 or 3 airframes into summer 2020, BA has just added a 3rd daily Miami and AA is upping theirs to make it 5xdaily across the JBA this summer. That allows an airframe to be freed up as the densification of the LGW RR 777s takes place. It also pushed Norwegian into BA/AA's stronghold where 5xdaily flights allows BA/AA to control the pricing on the route without materially affecting their bottom line. With over 1,500 seats compared to Norwegian's ~300 it's clear to see who's in the driving seat.



Some of us have access to systems that can give us this information, but it can also be found here if you know how to manipulate data. It does have to be published publicly in the USA and you can crunch the data by carrier at an airport to figure out these numbers: https://www.transtats.bts.gov/Tables.asp?DB_ID=111

If you have more accurate cost numbers for LGW besides "lower" I could use them in my model, but from the information I have these routes would need the load factors stated above to break even. This is not to say ALL routes from LGW need a 85%+ load factor to break even, but in this specific case, it needed somewhere north of 80%.


I'm seeing nothing that mentions revenue per passenger kilometre/mile for a particular route.



Assuming you know how yield is calculated you can pull most of the data sets you need from https://www.transtats.bts.gov/Tables.asp?DB_ID=111. It is not given as a field or drop down that is just handed to you. You can pull different data sets like https://www.transtats.bts.gov/Oneway.as ... lay_Flag=0 and cross it with your specific routes data, RPMs, and load it into excel and use a pivot table to manipulate all the data sets to calculate yield. You can load other route data to calculate other cities. There was a detailed post how to do this and other scenarios years ago on this forum. You can probably find it using the search feature.

Additionally, you can get this data packed easily for you from subscription services like Diio or even use to get basic data from Statista, but that of course costs money.

Airports also usually publish an amazing amount of data on airlines operating at their airport and I use to spend hours looking at that information. When an airline operates to just one destination from that airport or there is only one route operate on the route, you can use a lot of the airport's own data to substantiate your findings.

In the end, I can assure you the numbers I quoted you are correct as far as yields for those routes. The conclusions drawn were my own.
 
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Miami
Topic Author
Posts: 6028
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Re: British Airways cancels Fort Lauderdale service

Sat Sep 07, 2019 9:15 am

Last flight is today.
Aviation is proof that given, the will, we have the capacity to achieve the impossible. - Eddie Rickenbacker
 
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enilria
Posts: 9624
Joined: Fri Feb 22, 2008 7:15 pm

Re: British Airways cancels Fort Lauderdale service

Sat Sep 07, 2019 12:18 pm

8herveg wrote:
Surely if Norwegian have moved their flight to MIA, this would mean that BA have more chance of making FLL work as they are now the only option for people flying from LON (all of Europe in fact) to FLL?

It was never intended to “work”. It was just there to damage Norwegian financially which it achieved. Plus, OW has a huge hub at MIA, not FLL.
 
HP69
Posts: 213
Joined: Sat Jun 29, 2019 3:04 pm

Re: British Airways cancels Fort Lauderdale service

Sat Sep 07, 2019 2:02 pm

enilria wrote:
8herveg wrote:
Surely if Norwegian have moved their flight to MIA, this would mean that BA have more chance of making FLL work as they are now the only option for people flying from LON (all of Europe in fact) to FLL?

It was never intended to “work”. It was just there to damage Norwegian financially which it achieved. Plus, OW has a huge hub at MIA, not FLL.


It still could have worked as a stand-alone flight just as BWI and EWR have flights despite all the capacity at IAD and JFK.

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