Lufthansa has been on a roll lately - they are definitely one of the survivors as identified by Michael O'Leary but they seem to have courted a number of problems that are now comping back to bite them.
They are in a dominant market position in the German and German speaking market. With no real indigenous challengers (they own part of EuroWings/GermanWings the largest local German LCC) they are able to dominate their market. The labour unions obviously would like a part of that by getting better working conditions and/or higher wages.
2 Weeks ago it was the ground staff. This week it is the German pilot's union "Cockpit" . The first demand is for parity from the LH Regional subsidiary Cityline and the mainline pilots. Why would someone flying a RJ get parity? Well actually its a little more complicated. As LH replaces its AVROs with newer Embraer E-Jets it will use these aircraft too to replace the older Boeing 737-500s and -300s. Currently Cockpit has a restriction in its contract for letting the Cityline pilots only fly less than 70 seaters. As the E-Jets go to over 100 - then this is a problem. Hence the strike.
But the current strike is but a skirmish for the main event where the mainline pilots want bigger raises and better benefits. So far LH has seen a little disruption from this current spate of strikes. But if this continues then we can see further strife affecting the airline's bottom line. Thus puts LH and its fellow network carriers in a difficult position. If LH caves in and pays the new wages then you can be sure that AF/KL and BA or rather their unions will join suit.
At just the time when restraint is needed we may have strong upward pressures on airline labour costs. One lesson they have learned is that when oil prices rose so spectaculalry how easy it was for the airlines to absorb such rises. So clearly that makes them easily capable of absorbing more wages costs.
08 August 2008
05 August 2008
Cool Website for Hotelies
One of my favorite hotel websites was for the longest time SeatGuru.com. Sadly now swallowed up by the Expedia monster.
However I found another site that does for Hotels what Seat Guru did for seats (not snakes) on a plane. Its early days but I think this will be immensely useful.
http://www.tripkick.com/how_it_works
Check it out.
Cheers
timothy
However I found another site that does for Hotels what Seat Guru did for seats (not snakes) on a plane. Its early days but I think this will be immensely useful.
http://www.tripkick.com/how_it_works
Check it out.
Cheers
timothy
So are you a good traveller? How many states have you visited?
According to the AOL Zogby survey not that many... read on:
More than one-third of Americans have traveled to fewer than ten states in their entire lifetimes.
But most (almost two thirds) have visited Florida, while more than half have also gone to California and New York, according to Greyhound.
More than half of Americans say they have less money for vacations in 2008 then they did last year.
More than two-thirds say, however, that gas prices will not affect their plans (source: AOL/Zogby Travel Survey).
Social media continues to grow in importance. In a recent study 48% of travelers read user reviews for hotels and lodging before booking their stay, according to AOL/Zogby.
If you are a real traveller then you need to have visited 100 countries or more. For this go to the elite of elites list:
http://www.travelerscenturyclub.org/
Cheers
Timothy
More than one-third of Americans have traveled to fewer than ten states in their entire lifetimes.
But most (almost two thirds) have visited Florida, while more than half have also gone to California and New York, according to Greyhound.
More than half of Americans say they have less money for vacations in 2008 then they did last year.
More than two-thirds say, however, that gas prices will not affect their plans (source: AOL/Zogby Travel Survey).
Social media continues to grow in importance. In a recent study 48% of travelers read user reviews for hotels and lodging before booking their stay, according to AOL/Zogby.
If you are a real traveller then you need to have visited 100 countries or more. For this go to the elite of elites list:
http://www.travelerscenturyclub.org/
Cheers
Timothy
Bishins's Genesis Still Born
It is not often that I am pleased to see enterprises go out of business. However in this case I will make an exception. The Genesis project - brain child of one Bruce Bishins was probably one of the most ill conceived projects ever devised in the Travel Business. And we have seen some REAL doozies over the years.
It is sad that those - especially small agency - enterprises who invested in the premise have seen their hard earned cash evaporate.
Genesis and its sister organizations were based on an idea that was always an obsolescent concept and out of pace with the technology of the time and the service model expected by the consumer. It has now gone to that graveyard of not so great ideas and in my opinion rightly so.
It never achieved traction in the manner its promoters claimed.
Fragmentation in the travel distribution systems is a way of life. But this particular niche just had no viability.
Cheers
Timothy
It is sad that those - especially small agency - enterprises who invested in the premise have seen their hard earned cash evaporate.
Genesis and its sister organizations were based on an idea that was always an obsolescent concept and out of pace with the technology of the time and the service model expected by the consumer. It has now gone to that graveyard of not so great ideas and in my opinion rightly so.
It never achieved traction in the manner its promoters claimed.
Fragmentation in the travel distribution systems is a way of life. But this particular niche just had no viability.
Cheers
Timothy
BA-AA Perhaps Way?
Timot for Virgin Atlantic to dust off its BA/AA No Way stickers.
WSJ and others are reporting that the proposed Alliance between AA and BA to create the world's largest airline (when included with Iberia) is further along and that an announcement can be expected in a matter of weeks.
The BA-AA Alliance in what ever form it takes would be a formidible competitor. It would dominate the UK-US traffic. Reducing the competition to effectively a big 2 (BA/AA/IB and the DL/KL/AF/NW) would force a re-shuffling of the deck chairs amongst the other players. LH would look to make a big effort to acquire an additional US presence and must be looking hard at CO. UAL and US are both probably too sick to warrant much interest.
Interestingly all of the players (CO excepted) have a culture of market dominant behavior. Frankly this merger mania will not result in an improved market position for any of them and would likely result in more shareholder writedowns and still not improvement in the service offering by the respective carriers.
On the positive side - the folks at Virgin America must be throwing wild parties and thanking their lucky stars that this is happening. it will open up opportunities for them in the Domestic US market. Similarly Alaska and AirTran should be happy. It even makes the Frontier business look actually quite attractive.
Of course Mr Oberstar and his friends will probably have something to say about this. I would challenge all of this assumption that merger is the answer to the root cause of the industry's ills.
Cheers
Timothy
WSJ and others are reporting that the proposed Alliance between AA and BA to create the world's largest airline (when included with Iberia) is further along and that an announcement can be expected in a matter of weeks.
The BA-AA Alliance in what ever form it takes would be a formidible competitor. It would dominate the UK-US traffic. Reducing the competition to effectively a big 2 (BA/AA/IB and the DL/KL/AF/NW) would force a re-shuffling of the deck chairs amongst the other players. LH would look to make a big effort to acquire an additional US presence and must be looking hard at CO. UAL and US are both probably too sick to warrant much interest.
Interestingly all of the players (CO excepted) have a culture of market dominant behavior. Frankly this merger mania will not result in an improved market position for any of them and would likely result in more shareholder writedowns and still not improvement in the service offering by the respective carriers.
On the positive side - the folks at Virgin America must be throwing wild parties and thanking their lucky stars that this is happening. it will open up opportunities for them in the Domestic US market. Similarly Alaska and AirTran should be happy. It even makes the Frontier business look actually quite attractive.
Of course Mr Oberstar and his friends will probably have something to say about this. I would challenge all of this assumption that merger is the answer to the root cause of the industry's ills.
Cheers
Timothy
The Cutbacks - USA Today's MAP
Dearly beloved,
The nice people at OAG and USA Today have put together a map that shows the impact of the currently scheduled flight cancellations YoY 2008/2007. It makes sobering viewing. However to some extent it is actually masking the impact of the cutbacks in that it only demonstrates FLIGHTS not passenger capacity. So with the downshift to smaller aircraft and the parking of some larger ones we should see a few more points of reduction. Further the full schedule cutbacks have not yet been published. It is estimated that LAX for example will see greater than 20% cutbacks.
Have the airlines cut back too far and is this necessarily saving them money and raising the yield potential. I am unconvinced.
Cheers
Timothy
The nice people at OAG and USA Today have put together a map that shows the impact of the currently scheduled flight cancellations YoY 2008/2007. It makes sobering viewing. However to some extent it is actually masking the impact of the cutbacks in that it only demonstrates FLIGHTS not passenger capacity. So with the downshift to smaller aircraft and the parking of some larger ones we should see a few more points of reduction. Further the full schedule cutbacks have not yet been published. It is estimated that LAX for example will see greater than 20% cutbacks.
Have the airlines cut back too far and is this necessarily saving them money and raising the yield potential. I am unconvinced.
Cheers
Timothy
03 August 2008
If Alitalia's financing sounds creative - lets look back
Perhaps one of the most dramatic bankruptcies in history was the Swissair - then known as the SAIR group which brought down two of Europe's most storied carriers - Swissair and Sabena (my sentimental favorite).
As we look at the very funky way that the Italian government plans to 'rescue" Alitalia lets look back at what happened.
For a good history narrative go here:
http://www.sevanco.net/news/full_story.php?id=1150
But just for fun fill in the blanks:
(BLANK BANK) chairman (XXX) said: "This drastic restructuring was the only alternative to secure the future of the (BLANK COUNTRY) aviation business. It is important for the (BLANK COUNTRY) public and for our economy and financial centre that a national flag carrier should provide services out of (BLANK COUNTRY)."
Lets see what happens in Italy and Greece. I suspect that we may see other countries and definitely different airlines using the same logic.
Cheers
Timothy
As we look at the very funky way that the Italian government plans to 'rescue" Alitalia lets look back at what happened.
For a good history narrative go here:
http://www.sevanco.net/news/full_story.php?id=1150
But just for fun fill in the blanks:
(BLANK BANK) chairman (XXX) said: "This drastic restructuring was the only alternative to secure the future of the (BLANK COUNTRY) aviation business. It is important for the (BLANK COUNTRY) public and for our economy and financial centre that a national flag carrier should provide services out of (BLANK COUNTRY)."
Lets see what happens in Italy and Greece. I suspect that we may see other countries and definitely different airlines using the same logic.
Cheers
Timothy
01 August 2008
Alitalia - now you don't see it ,now you see it.
In a masterly stroke of financial genius - Intesa SanPaolo has come up with the answer to what to do with Alitalia.
So here is how it works.
Alitalia buys Air One but not its debt. Alitalia then issues new shares as a new company including shares to AirOne's owners.
Say WHAT?
This is what was reported by Reuters.
http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKL140020420080731
I rest my case. The Italian government and Intesa Sanpaolo are certifiable.
So here is how it works.
Alitalia buys Air One but not its debt. Alitalia then issues new shares as a new company including shares to AirOne's owners.
Say WHAT?
This is what was reported by Reuters.
http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKL140020420080731
I rest my case. The Italian government and Intesa Sanpaolo are certifiable.
30 July 2008
OOPS did Ryanair get it wrong
Hmmm seems that the smart team at Ryanair is having a little difficulty. They got Fuel pricing wrong and they are going to be savaged for it.
So here is the scoop – wrong fuel hedging. For 2008 they didn’t actually hedge at all. Ooops. But worse – for 2009 they are getting it wrong also. Read from CAPA and Bloomberg.
Ryanair stated (28-Jul-08) it has hedged 90% of its fuel requirements for Sep-08 at USD129 per barrel, and for the three months ended 31-Dec-08 at USD124 per barrel (Bloomberg, 28-Jul-08). The carrier, which reported fuel costs increased 93% year-on-year to EUR367 million for the three months ended 30-Jun-08, has no hedging in place for the fourth quarter (Jan-Mar-09), though it would take out further hedges shortly. CEO, Michael O'Leary, stated in May-08 that Ryanair would not hedge until oil prices fell below USD100 a barrel.
Oh dear.
So lets hope they get it right soon… otherwise the big boys will be very happy to throw a lot of dog poo in Michael O’Leary’s direction.
This does seem to point out that there the airline business is no place for the feint hearted and that you can make mistakes even if you are one of the leaders.
Cheers
Timothy
So here is the scoop – wrong fuel hedging. For 2008 they didn’t actually hedge at all. Ooops. But worse – for 2009 they are getting it wrong also. Read from CAPA and Bloomberg.
Ryanair stated (28-Jul-08) it has hedged 90% of its fuel requirements for Sep-08 at USD129 per barrel, and for the three months ended 31-Dec-08 at USD124 per barrel (Bloomberg, 28-Jul-08). The carrier, which reported fuel costs increased 93% year-on-year to EUR367 million for the three months ended 30-Jun-08, has no hedging in place for the fourth quarter (Jan-Mar-09), though it would take out further hedges shortly. CEO, Michael O'Leary, stated in May-08 that Ryanair would not hedge until oil prices fell below USD100 a barrel.
Oh dear.
So lets hope they get it right soon… otherwise the big boys will be very happy to throw a lot of dog poo in Michael O’Leary’s direction.
This does seem to point out that there the airline business is no place for the feint hearted and that you can make mistakes even if you are one of the leaders.
Cheers
Timothy
29 July 2008
In case you missed it - here is a peak at EVE
She is mighty pretty...
For more pictures go here and download as many as you want.
Cheers
Timothy
http://www.virgingalactic.com/pressftp/
The BA+Virgin et al Price Fixing Scandal Update
The rather nasty case of Price Fixing filed by authorities on both sides of the Atlantic is making some progress.
The consent agreement (in my humble opinion a win for the lawyers only) is now public with a website - www.airpassengerrefund.com.
Ads and emails have been going out and you can sign up to get your refund. Just don't hold your breath on getting paid. It will be many years before payments are made. All this time the lawyers fees will be racking up. Proving once again that old adage that the law can be one giant Ass!!!!
Now comes news that those involved on the BA side including former commercial director Martin "Boy" George may face prosecution from the UK's OFT - office of Fair Trading. Formally according the Britain's Telegraph Newspaper:
The Office of Fair Trading is preparing to announce price-fixing charges against British Airways head of sales, Andrew Crawley; its former marketing and commercial director, Martin George; Iain Burns, former communications head; and Alan Burnett, who previously ran the airline’s UK/Ireland sales operation.
What a nasty mess
The consent agreement (in my humble opinion a win for the lawyers only) is now public with a website - www.airpassengerrefund.com.
Ads and emails have been going out and you can sign up to get your refund. Just don't hold your breath on getting paid. It will be many years before payments are made. All this time the lawyers fees will be racking up. Proving once again that old adage that the law can be one giant Ass!!!!
Now comes news that those involved on the BA side including former commercial director Martin "Boy" George may face prosecution from the UK's OFT - office of Fair Trading. Formally according the Britain's Telegraph Newspaper:
The Office of Fair Trading is preparing to announce price-fixing charges against British Airways head of sales, Andrew Crawley; its former marketing and commercial director, Martin George; Iain Burns, former communications head; and Alan Burnett, who previously ran the airline’s UK/Ireland sales operation.
What a nasty mess
BA+IB - this time BABI its for real
British Airways and Iberia have finally started that long trip up the aisle. Not content to have the Alliance in One World and the Select Gang of 3 with American - this time they have realized that perhaps they are better together. Let's call this arrangement BABI!
Iberia's Ownership has been in doubt for some time since TPG made a slight move about 18 months ago. Then BA said it wanted out of the ownership position. (it owns about 10%). Now as Iberia has struggled with the position of not being quite big enough and having little room to grow - it has finally come to the realization that its future is probably better under the BA banner than going it alone.
BA fresh from it's absorbing of L'avion, is looking to put some more ASMs under its belt to replace those lost by the defections of GBAirways and BMED last year. The strength of AF/KL and LH/LX has made the map of Europe look mighty inviting. It also strengthens their position in any potential merger with AA.
Not wishing to put too fine a point on it - while the deal is/was inevitable - it is still not necessarily the right thing to do. This time the regulators in Brussels should be looking at the deal with a lot more eyes.
And just how big with the new carrier be? The deal will make BABI the 3rd largest carrier in terms of revenue, probably 5th largest just ahead of a slimmed down UAL in terms of pax and the same just ahead of CO in terms of RPMs.
Cheers
Timothy
Iberia's Ownership has been in doubt for some time since TPG made a slight move about 18 months ago. Then BA said it wanted out of the ownership position. (it owns about 10%). Now as Iberia has struggled with the position of not being quite big enough and having little room to grow - it has finally come to the realization that its future is probably better under the BA banner than going it alone.
BA fresh from it's absorbing of L'avion, is looking to put some more ASMs under its belt to replace those lost by the defections of GBAirways and BMED last year. The strength of AF/KL and LH/LX has made the map of Europe look mighty inviting. It also strengthens their position in any potential merger with AA.
Not wishing to put too fine a point on it - while the deal is/was inevitable - it is still not necessarily the right thing to do. This time the regulators in Brussels should be looking at the deal with a lot more eyes.
And just how big with the new carrier be? The deal will make BABI the 3rd largest carrier in terms of revenue, probably 5th largest just ahead of a slimmed down UAL in terms of pax and the same just ahead of CO in terms of RPMs.
Cheers
Timothy
27 July 2008
Is there a life after being a Travel Agent? Let's ask this guy
http://www.cnn.com/2008/WORLD/asiapcf/07/27/japan.porn/index.html
OK now I have your attention - perhaps you can read the article.
This former travel agent retired in Japan and found a new career as a porn star.
So for all those US travel agents who have been looking for a second career look no further than you local DVD store
Best of luck to you
OK now I have your attention - perhaps you can read the article.
This former travel agent retired in Japan and found a new career as a porn star.
So for all those US travel agents who have been looking for a second career look no further than you local DVD store
Best of luck to you
26 July 2008
New GetThere tool makes headway for harassed Travel Arrangers
NBTA Preview Report
I was chatting with Forrester's Henry Hardeveldt and we both were bemoaning the fact that the process of travel arranging is still stuck in the dark ages. He shared with me some of the results from their recent piece on the 3 types of business traveller.
Here is a summary http://www.forrester.com/Research/Document/Excerpt/0,7211,46033,00.html
The heavily managed travellers who fly the most frequently basically don't like the process at all. (I realize this comes as a great shock to everyone).
While not having an epiphany and revolutionizing the process of travel arranging - Sabre has made a step in the right direction with their new Travel Arranger portal on GetThere.
I am looking forward to getting a demo of this tool because the general process is still stuck in the dark ages.
For those of you not going to NBTA in LA next week here is a microsite with some of the functions explained:
http://www.getthere.com/travelarranger/
I still live in hope that there will be a better solution across the board. While I am looking forward to a revolution in this whole process - I fear we will be forced to accept evolutionary steps. This tool sounds like at least its movement in the right direction.
Cheers
Timothy
I was chatting with Forrester's Henry Hardeveldt and we both were bemoaning the fact that the process of travel arranging is still stuck in the dark ages. He shared with me some of the results from their recent piece on the 3 types of business traveller.
Here is a summary http://www.forrester.com/Research/Document/Excerpt/0,7211,46033,00.html
The heavily managed travellers who fly the most frequently basically don't like the process at all. (I realize this comes as a great shock to everyone).
While not having an epiphany and revolutionizing the process of travel arranging - Sabre has made a step in the right direction with their new Travel Arranger portal on GetThere.
I am looking forward to getting a demo of this tool because the general process is still stuck in the dark ages.
For those of you not going to NBTA in LA next week here is a microsite with some of the functions explained:
http://www.getthere.com/travelarranger/
I still live in hope that there will be a better solution across the board. While I am looking forward to a revolution in this whole process - I fear we will be forced to accept evolutionary steps. This tool sounds like at least its movement in the right direction.
Cheers
Timothy
EK's A380s have Showers on board!
OK so Emirates is using the term "indulgence" to describe their premium classes on the upper deck of the new A380 services which start DXB-JFK on August 1st - that's next week.
Outdoing Singapore Air - EK will offer a premium service which initially looked rather tame - but the actual pictures (and from sneak peaks comments from a few who have actually been on the ship) this is going to be one humdinger of a service.
The Biz Class cabins are none too shabby either. You get your very own minibar at your seat.
The clear water in product differentiation of the Middle East Carriers from the rest of the world is going to be growing.
Thank you Emirates for bringing back a little of the opulence to the process of travel. Now if I can only figure out a way to wangle a seat on one of these puppies.
Cheers
Timothy
Outdoing Singapore Air - EK will offer a premium service which initially looked rather tame - but the actual pictures (and from sneak peaks comments from a few who have actually been on the ship) this is going to be one humdinger of a service.
The Biz Class cabins are none too shabby either. You get your very own minibar at your seat.
The clear water in product differentiation of the Middle East Carriers from the rest of the world is going to be growing.
Thank you Emirates for bringing back a little of the opulence to the process of travel. Now if I can only figure out a way to wangle a seat on one of these puppies.
Cheers
Timothy
The Professor is travelling and will be in LA for NBTA annual Shindig
I hope to bring you some tidbits from what is happening and the general sentiment of the corporate travel managers.
Direct from the bar stool research council - I think we should be able to put a thermometer in the mouths of the corporate travel market and see what's making them sick and what the various doctor's think are the remedies to what ails the patients.
Cheers
Timothy
Direct from the bar stool research council - I think we should be able to put a thermometer in the mouths of the corporate travel market and see what's making them sick and what the various doctor's think are the remedies to what ails the patients.
Cheers
Timothy
Qantas's Geoff Dixon outlines a new world order - is he right?
So we are now headed for the era of the mega carrier and little else. Oh yes by the way your fares are going to double and your service will suck but apart from that we will be all right Jack.
http://www.congresscheck.com/2008/07/25/qantas-boss-predicts-%E2%80%98new-world-order%E2%80%99/
I have to take issue and point out a few salient points to Mr Dixon's self serving remarks.
Lets start with the supposition that the airline network model is the right one. Clearly he doesn't think so because he has put his eggs into the LCC model with Jetstar. Just because the FNC (Full Service Network Carrier) model is broken in so many places doesn't mean that other models can fly. If you will pardon the pun.
The LCC model is alive and well. (Ryanair and Air Asia)
The HVC (Hybrid Value Carrier) model is alive and well (Aer Lingus and EasyJet)
The niche market is constantly evolving. The results have been mixed over the last year. We have seen the outright failure of the business only carriers. Yet the niche business services continue to flourish. (Eg LH/AF/KL/BA/LX biz class services).
Where he is right is that this is a step up in terms of what an airline must do. This is where the current crop of legacy airline managements need to have their heads examined. The model needs changing and some airlines will be successful at this and others will just fail. The airline business is high risk and not necessarily high value. There is a great deal of clear water between the consistently successful players and the rest of the market.
As Exhibit A in the "fuel is the root cause of all evil" debate - I present Allegiant Airlines. An airline that is continuing to fly allegedly fuel inefficient MD80 series aircraft.
So the view of the world dominated by the mega boys is not necessarily one I can subscribe to. I suggest you go and read a previous blog entry that I posted earlier this year. I believe now is actually a good time to start an airline. Critical lift in certain markets is needed. If you have planes and can move them to those markets - then you can now make money without fear of intervention by the incredibly shrinking big boys.
If Mr Dixon's view of the world is right we are in for a large amount of grey mice. Let's hope there are a lot of colorful parrots out there who will seize the opportunity and bring in a new crop of airlines with low costs and more appropriate business models that will hopefully make the industry more fundamentally sound.
Its nice to dream
Cheers
Timothy
http://www.congresscheck.com/2008/07/25/qantas-boss-predicts-%E2%80%98new-world-order%E2%80%99/
I have to take issue and point out a few salient points to Mr Dixon's self serving remarks.
Lets start with the supposition that the airline network model is the right one. Clearly he doesn't think so because he has put his eggs into the LCC model with Jetstar. Just because the FNC (Full Service Network Carrier) model is broken in so many places doesn't mean that other models can fly. If you will pardon the pun.
The LCC model is alive and well. (Ryanair and Air Asia)
The HVC (Hybrid Value Carrier) model is alive and well (Aer Lingus and EasyJet)
The niche market is constantly evolving. The results have been mixed over the last year. We have seen the outright failure of the business only carriers. Yet the niche business services continue to flourish. (Eg LH/AF/KL/BA/LX biz class services).
Where he is right is that this is a step up in terms of what an airline must do. This is where the current crop of legacy airline managements need to have their heads examined. The model needs changing and some airlines will be successful at this and others will just fail. The airline business is high risk and not necessarily high value. There is a great deal of clear water between the consistently successful players and the rest of the market.
As Exhibit A in the "fuel is the root cause of all evil" debate - I present Allegiant Airlines. An airline that is continuing to fly allegedly fuel inefficient MD80 series aircraft.
So the view of the world dominated by the mega boys is not necessarily one I can subscribe to. I suggest you go and read a previous blog entry that I posted earlier this year. I believe now is actually a good time to start an airline. Critical lift in certain markets is needed. If you have planes and can move them to those markets - then you can now make money without fear of intervention by the incredibly shrinking big boys.
If Mr Dixon's view of the world is right we are in for a large amount of grey mice. Let's hope there are a lot of colorful parrots out there who will seize the opportunity and bring in a new crop of airlines with low costs and more appropriate business models that will hopefully make the industry more fundamentally sound.
Its nice to dream
Cheers
Timothy
Sold - One Airline - Cheap. Frontier gets funding
Frontier managed to find a savior at the last minute. For $79 million DIP financing - Perseus basically picked up the ailing Denver based carrier. They will end up with the option to purchase just under 80% of the airline for $100 million.
http://www.marketwatch.com/news/story/frontier-airlines-receives-commitment-75/story.aspx?guid={F34ECFC2-4879-4D00-8054-DDDB7E6CFD01}&dist=hppr
I think they got a good deal. Whether it is a wise deal will remain to be seen.
I have high hopes for the chaps at F9. They will need all the luck they can get with UA squeezing them from the top and WN from below. However consider the situation. WN is not going to grow that much (however given their size "not much" is actually quite a lot since they are now the world's #1 passenger mover). UAL is dropping 25% of its fleet. So F9 may just be able to dodge the bullet if they can price their product right and get the mix right. I think they will unless they are incredibly stupid. Well this is the airline industry so you know what that means.
Cheers
Timothy
http://www.marketwatch.com/news/story/frontier-airlines-receives-commitment-75/story.aspx?guid={F34ECFC2-4879-4D00-8054-DDDB7E6CFD01}&dist=hppr
I think they got a good deal. Whether it is a wise deal will remain to be seen.
I have high hopes for the chaps at F9. They will need all the luck they can get with UA squeezing them from the top and WN from below. However consider the situation. WN is not going to grow that much (however given their size "not much" is actually quite a lot since they are now the world's #1 passenger mover). UAL is dropping 25% of its fleet. So F9 may just be able to dodge the bullet if they can price their product right and get the mix right. I think they will unless they are incredibly stupid. Well this is the airline industry so you know what that means.
Cheers
Timothy
25 July 2008
In the river of blood red ink there are .... 1st Half Financials Reviewed Podcast
Come here the professor and Mrs O'Leary (not from Europe) debate the sea of red ink that is the 1/2 year reporting results.
A light hearted delivery of a bad situation
Cheers
A light hearted delivery of a bad situation
Cheers
24 July 2008
Whose missing in the Star Crossed Love Fest?
The announcement today of Continental's formal application to join the Star Alliance and join with United Airlines and 8 other Star members in creating a gigantic transatlantic alliance has a missing member.
It looks like US Airways is being cold shouldered here.
Additionally a special "gang of 4" (AC, CO, UA, LH) has been formed to compete with the other SkyTeam "gang of 4" (AF, KL, NW, DL) and the proposed "gang of 3" (BA, AA, IB) Oneworld members to create another transatlantic JV.
I hope you are following so far.
Well the Skyteam4 made a great deal of noise about this when they started 3 services LHR-LAX, SLC-CDG and JFK-LYS. True seamless experience right?
Actually no.
I tried to purchase a ticket and upgrade from LAX-LHR using my super wonderful status on DL and was told (in no uncertain manner) that no this was actually an Air France flight and that therefore no upgrade for Delta passengers was allowed.
So much for this great idea. This new Star love fest (sans US Airways) should be a true seamless service but like many things in the airline business - its all show and PR rather than any actual substance.
When will they ever change? Comments directly to the Professor or leave them here.
Cheers
Timothy
It looks like US Airways is being cold shouldered here.
Additionally a special "gang of 4" (AC, CO, UA, LH) has been formed to compete with the other SkyTeam "gang of 4" (AF, KL, NW, DL) and the proposed "gang of 3" (BA, AA, IB) Oneworld members to create another transatlantic JV.
I hope you are following so far.
Well the Skyteam4 made a great deal of noise about this when they started 3 services LHR-LAX, SLC-CDG and JFK-LYS. True seamless experience right?
Actually no.
I tried to purchase a ticket and upgrade from LAX-LHR using my super wonderful status on DL and was told (in no uncertain manner) that no this was actually an Air France flight and that therefore no upgrade for Delta passengers was allowed.
So much for this great idea. This new Star love fest (sans US Airways) should be a true seamless service but like many things in the airline business - its all show and PR rather than any actual substance.
When will they ever change? Comments directly to the Professor or leave them here.
Cheers
Timothy
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