17 March 2008

Blog Number 300

Now we feel really old. This is the 300th Blog entry from T2Impact. We should have a glass of champagne or something to celebrate.

Truth is however there is a lot of doom and gloom around. The US economy is in the toilet and Paulson and Bush seem to have no answer to the economic ills that face the current world’s largest economy. So rather than celebrate – we are going to use this occasion to stare into our crystal ball and look at the US Airline market. Despite their best year ever – profits and passenger wise. There are basically many structural problems affecting the market. Not content with taking a neutral position – some of the leading analysts – Jamie Baker at JPMorganChase and the S&P guys are being active in marking down the US airlines.

Why are we seeing this now? The trigger has for sometime being the buildup in the cost side of the airlines economic equation. The run up to $100/barrel oil did nothing to slacken the pace of airline price increases and consumer appetite for airline services. Indeed as we reported earlier this year the 2008 holiday season looks very bright based on the January Caribbean Hotel mart. But elsewhere the whole market looks miserable. We saw a distinct drop off in January traffic which seemed to echo the slowdown we saw from August of last year. In February we were surprised by a strong performance in the US market – we suspect March’s traffic reports (airport movements) will go soft again. Airlines are going to start pulling capacity again. Hopefully they will to remain healthy.

On a brighter note – I would like to thank all of you for your support and assistance in delivering this milestone. When we first started writing seriously from last year – I was still a skeptic about the whole blog movement. However now we have been doing this for some time – I for one am a convert and an ardent fan. However we do hope that people realize that there has to be a code of conduct and that sooner or later one will be published. Publish and be Damned still comes at a price. We have no aspirations of being a Matt Drudge.

Thank you for all your comments – public and private. They actually do help us to focus our efforts. Finally thanks to the unseen people who use the information for their improvement! We hope that this blog will continue to be helpful to everyone. Given that the lads and lasses at T2 all have day jobs – and your truly does too – it is a wonder sometimes that we get any time to write. But we will continue to publish while you continue to read.

And it’s a good night from him


Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583

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