Thursday, June 29, 2006

Follow-Up: Williams-Mesa Airport and Festival Still Talking

The initial talks between Williams-Mesa and Festival appear to progressing. Read about it here.

Wednesday, June 28, 2006

Vision's Growth Delayed...Slightly

All in all this is not bad news...

Thursday, June 22, 2006

CQ Air Has Gone Quiet

We and our sources have heard nothing regarding CQ lately. Let's hope they get through this rough patch.

Wednesday, June 21, 2006

Vision Need Not Worry About US Airways

Yesterday, Parker said that US Airways is unlikely to ever use Mesa-Williams Gateway Airport. This is obvious to many of us, but it serves to underscore the point that there are many revenue opportunities for new entrants that do not fit the hub and spoke model.

Tuesday, June 20, 2006

Toronto City Airport Plan Gains Steam

According to the Star,It looks like well over $100mm CAD has been raised.

Sunday, June 18, 2006

Wright Amendment Changes

The Wright Amendment is in transition. Southwest is so big that they are struggling to find meaningful airports to grow into and maintain their self-imposed growth rate of 8%-10%. So with DAL they are fighting for the lifting of regulations that will allow for growth at home since other low-risk options throughout the country that would have a meaningful impact to their growth rate are starting to dwindle. This growth requirement has slowly driven them away from their core point-to-point model since the mid-90's. The growth rate that they have sought has been met, but has resulted in a less cost-effective network...such as its substantial operations at PHL and, for all intents and purposes, a hub & spoke operation at BWI.

When we say that Southwest is not the LCC that it once was, this networking issue is a large part of the underlying problem that is driving a less productive fleet and workforce. Of course on top of this their pay rates are high, their staff is very senior and, being around 30+ years, Southwest's infrastructure is just plain old.

Thursday, June 15, 2006

Festival's Surveys Are In

As reported here, Festival sent out tens of thousands of surveys asking potential customers to list favored Festival cities to fly to. The report says that their destinations could be announced in July.

Tuesday, June 13, 2006

International Captial Flow

As you might expect, we support looser restrictions on foreign ownership. It will lead to a faster cure for the current crop of very sick airlines in an otherwise healthy market. This article voices the opinion of a few of the EA blog's friends on the subject.

Thursday, June 08, 2006

Bonderman Says Sell

As far as the majors go...we agree with this. Authentic, smart LCCs (there are none in the US right now) will continue to grow.

Tuesday, June 06, 2006

Speaking of Festival...

Below is a survey we received on May 19 from Festival regarding destination choices. We sincerely hope they have some good, creative people in their network divisions that are working on something else besides this...

Dear Emerging,
You are receiving this Festival Airlines ® Destination Survey because you were one of the first people to sign up for the Festival Airlines Newsletter . Since you have already expressed interest in Festival Airlines, your feedback is very important to us. As we prepare for our launch, we’re interested in learning more about where you would like to vacation! Please take a few moments to answer the survey questions below.Look for the first edition of our Festival Airlines Newsletter sometime in the very near future. It will be loaded with great vacation ideas and lots of information about Festival Airlines and Festival Vacations ™ inclusive packages.We wish you a pleasant summer and look forward to welcoming you aboard soon!

Best regards,Christian H. HellerVice President

Do you know anyone who might want to take this Destination Survey? Invite them to send us their feedback.

Festival Airlines Destination Survey:
1.We’re considering the following destinations for our preliminary schedule. Please rate each based on your likelihood to vacation in each of the following (VeryLikely, Likely, Notlikely):
Ft. Meyers
San Juan
Ft. Lauderdale
Niagara Falls, ON
San Francisco
St. Petersburg, FL
Las Vegas
Portland, Maine
Vancouver, BC
Cancun, Mexico

2. What other destinations are you most interested in?

3. How many vacation trips do you take per year, including long weekends?
Select One Two Three Four or more

4. Would you be more likely to purchase your airline ticket separately, in conjunction with affordable hotel accommodations, or as part of a more complete value vacation package that included hotel, transportation and other activities and amenities?
Air only
Air + hotel
Vacation package

Ryan International's Rockford Move Getting Closer

Here is another article tracking Ryan International's HQ move from Wichita to Rockford. Why hasn't the press picked up on the possible Ryan Int'l / Festival Airlines connection?

go! Gets Going Friday

As noted here, Mesa begins its attack on Aloha and Hawaiian this coming Friday.

We aren't lawyers, but if there are any out there...would you care to comment on why easyJet isn't complaining that Mesa has infringed on the Go Fly name? Is it as simple as the fact that 1.) One is a US company and the other isn't, and 2.) It's not an exact replication of the name?

Sunday, June 04, 2006

Spirit to Myrtle Beach & Other Spirit Thoughts

Spirit will is adding a Myrtle Beach/Boston run.

We're unsure about Baldanza being inserted as the CEO at Spirit. Is he capable of being innovative or is he going to be just another big airline exec making the same mistakes the rest of the US industry majors have made? Allegiant going public before Spirit is an embarrassment to everyone involved in the two rounds of equity infusions at Spirit (the second round being needed as they neared bankruptcy a year after the first). The bottom line is that Allegiant grew smarter than Spirit. Spirit's use of the equity lacked any creative thought. They applied big airline principles to their small airline by acquiring new aircraft and a build-up of a hub along the most beaten path at FLL. They banked on 199 seat A321s giving them the lowest ops CASM in the industry...when old-school metrics like that carry less weight than they ever have.

Our opinion on starting & growing airlines is more fully articulated in other posts (and in our models & other work), but put quite simply it is that there are still large opportunities for those who "zag" while the big boys in the industry "zig". Allegiant has done just that. Nobody wants MD-80s? "OK", says Allegiant to Spirit, we'll take your cast-off aircraft on the cheap. Nobody wants to fly to Sanford? "OK" says Allegiant, we'll be the only game in town at the 2nd airport in a top leisure destination & get big incentives along the way. Meanwhile, Spirit paid dearly for new Airbus and has more competitors per route than anyone else in the industry.

We've drastically simplified the Spirit / Allegiant comparison in this post. We could go on for quite a while...this is just a headline or two to consider when looking at the divergent fortunes of these relatively large EAs.

Vision Thinking Big

Vision's start at Mesa Airport has prompted talk that there may be expansion throguhout the West in its future.

Thursday, June 01, 2006

CQ Air

We're hearing some strange info about details yet, but we're more skeptical than we have ever been.

Update 6/2: We're glad we were a step ahead on this...though the reasons behind it are what we are interested in. Hat tip to Planespotting for the article link

Baltia Airlines

We hear these guys are a long way from getting started.