Some US Airlines Leave Money On The Table

billreid · Sat Oct 14, 2006 1:36 pm

B6 started 21 September JFK-SRQ with a single frequency. Load Factor over 90% in the worst month of the year. Why only one frequency?

FL has higher yield to MDW from SRQ, than UA from TPA to ORD.

NW yields $27 per seat higher to DTW from SRQ than to DTW from TPA with same load factor. But NW kills service every year at SRQ on May 1st with load-factor well into the eighties??

Are the airlines missing a diamond in the rough?
Are the airlines just misreading the facts from their own industry data, do they not want to make money? What's the story?

Why do airlines turn tail and chose to leave significant dollars on the table? The B6 load factor being so high during the worst month of the year tells a story.

bigb · Sat Oct 14, 2006 2:15 pm

Don't get Yields confused with load factors! You can high load factor on both high and low yield routes

toltommy · Sat Oct 14, 2006 2:39 pm

Just because yield is high in peak season, thats no indication that the yield will remain as high. And as everyone knows, a 100% load factor is not a guarantee of profit on ny particular route.

Snowbirds will pay extra to fly directly into SRQ in the winter. There just are not enough of them to keep the service year round.

billreid · Sun Oct 15, 2006 11:05 am

Quoting TOLtommy (Reply 2):
Just because yield is high in peak season, thats no indication that the yield will remain as high. And as everyone knows, a 100% load factor is not a guarantee of profit on ny particular route.

Yes T-100 data is for four quarters. TPA lags SRQ in Yield in each quarter. Not only in 93% of all destinations but in each quarter.
Come up with a better answer??

Quoting Bigb (Reply 1):
Don't get Yields confused with load factors! You can high load factor on both high and low yield routes

No confusion at all.
T-100 data is a ten percent sample required by law of every domestic ticket.
TPA yields concistently lower than SRQ to 93% of all destinations.
The airlines chose for significantly lower total revenue on board for their flights.

CMHSRQ · Mon Oct 16, 2006 11:08 pm

What are the costs associated with SRQ, TPA and RSW? Yield is one thing but if its five times more expensive to fly a pax from SRQ than TPA then it's a wash. Also don't carriers have agreements with an airport to cover all expenses, and if the airports revenues are higher then the expenses the airport then splits those with the airlines?

TPA has the critical mass to return a lot of revenue back to the airlines. I don't think SRQ does. RSW not sure of with that new terminal. I know it's difficult to do but if I were running SRQ I would cut costs in addition to finding new sources of revenue. Drop the PFC and each pax saves $10 a ticket. That can make a difference for the people who focus on the cost of the ticket and nothing else.

With jetBlues one flight a day you still need to pay for the same fixed cost for ramp space, gate rental, ticket counter space as AirTran's soon to be 9 flights a day. Labor will be slightly higher but not much. If there is only demand for 1 flight a day then it gets rather expensive per pax.

Correct me if I'm wrong.

Tango-Bravo · Tue Oct 17, 2006 6:31 am

Bottom line, it would seem, is a case of "good" vs. "best" when airlines decide what routes and flight frequencies to operate when. Perhaps additional frequencies to/from SRQ would be "good" but there are other opportunities that are seen as "better" by airlines when allocating their aircraft resources during various seasons. It is very much a balancing act with a host of considerations that are weighed in airlines' flight scheduling decisions, especially in primarily leisure markets where traffic tends to be subject to seasonal fluctuations.

supa7E7 · Tue Oct 17, 2006 8:42 am

It does seem weird. SRQ will probably see lots more service once E-175s come online at NW, more E-190s at B6, etc. It is not a 757-filling city like TPA is, but it should have a more complete routemap than it does.

CMHSRQ · Thu Oct 19, 2006 4:36 am

Freight and mail are also revenue producing, SRQ has no mail, and a small freight volume.

ikramerica · Thu Oct 19, 2006 5:59 am

Quoting TOLtommy (Reply 2):
Snowbirds will pay extra to fly directly into SRQ in the winter. There just are not enough of them to keep the service year round.

False. Airlines were thinking that way by not looking at the changing demographics of Florida and Sarasota/Bradenton in particular. There is still a large seasonal population, but that has grown as well as the year round population growing even more. SRQ has had a huge build up of housing in the last 15 years, and it is only now subsiding due to the stagnant housing market. Many of these new communities are "own only" where you can't rent it out. And that leads to a good number of people living year round, or visiting year round. And we aren't talking trailer parks like it used to be, we are talking houses from $250k to $2 million, and condos in the harbor area that are $1 million plus. Pricey enough to attract pax to SRQ, but not so pricey that they would own their own private jets...

For an example of a seasonal community that has become more year round, look at Fort Myers. And they've been able to sustain more frequent and less seasonal flights because of this. Look at Palm Beach. Used to be seasonal for PBI, but more and more people are living in Boca, Palm Beach, etc. year round.

SRQ may be hot in the summer, but it still has good golf, fishing and beaches, and in the USA, the concept of going on holiday to Florida and Hawaii only in the winter is a thing of the past.

Expect service to continue to grow at SRQ.

Quoting CMHSRQ (Reply 4):
What are the costs associated with SRQ

Used to be high, now they have realized they were only preventing airlines from serving them. That was part of the problem.

Now I'm seeing consistently equal or lower fares into SRQ than into TPA, instead of the other way around. AA really needs to open up SRQ-MIA flights...

Some US Airlines Leave Money On The Table

Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

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RE: Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

RE: Some US Airlines Leave Money On The Table

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