Browsing Posts published in November, 2009

Frontier has been surprisingly quiet about its latest product change, a new premium economy section called Stretch. I saw it mentioned on their Facebook page, and I believe they mentioned it on their earnings call, but I haven’t seen much else. This will be good news for some and Frontier Tails Introduce Stretch Premium Economynot-so-good news for others. Still, I think it’s a smart move that will have many benefits for the airline.

Stretch is pretty much the same as Economy Plus on United and Even More Legroom on JetBlue. You’ll get 4 more inches of legroom than you get today (36 inch seat pitch) if you sit in the first four rows, but the service is the same as coach. Of course, if legroom goes up on some seats, legroom goes down on the rest of the plane. Good news, bad news, see?

Originally, Frontier had 33 inches of seat pitch (the distance between a point on your seat to that exact same point on the seat in front of you). A year or two ago, they reduced that to 32 inches throughout the airplane. Now with this new change, Frontier says the number of seats won’t change, so as long as you can operate a calculator, you can figure out that this means legroom is going down in the back. They say most seats will have 31 inches of pitch but there will be some with 30 inches and some with 32 inches.

So how do you get those seats up front? Well you have to start by getting an airplane that has them in the first place. The Embraer 190s that are flying for Frontier have them now. The few A320s in the fleet will be done by December 15. The A319s will be done by February 1, and the lonely remaining A318s will be done by December 24 . . . 2010. My guess is they’ll be out of the fleet before they even bother with those. 2009. Looks like it was just a typo on their part.

If your airplane has Stretch, then there are a couple ways you can sit there. Remember, Frontier follows the Air Canada model of having distinct fare classes with different benefits. So if you’re in the top tier class (Classic Plus), you get to sit up there without additional charge. That’s the only way to get up front at the time of booking.

At the time of check-in, there are a bunch of other options. If you’re in the middle tier (Classic), you can sit up there for an additional $15 per segment. If you’re in the cheap bastard tier (Economy), it’s $25 per segment. Remember, that’s per segment so it could be $100 on a roundtrip with a connection.

The only other way to get up front (besides begging the gate agent and possibly showing some skin) is to be an elite member in the EarlyReturns frequent flier program. Actually, only the top tier Summit members get to sit up front, and they only get it at the time of check-in. The lower tier elite Ascent members have to pay just like everyone else. Same goes for the unwashed masses who have no elite status.

Overall, I like this plan. It provides a tangible benefit to those who purchase the Classic Plus fares. Creating value to encourage people to buy up is a good thing. And since they aren’t reducing the number of seats, it takes very little for this to be a revenue winner for them.

There’s also one more benefit. You know all those flights Frontier is operating for Midwest? I bet this ends up being sold as Signature Service when using the Midwest brand name. Of course, that’ll be a shadow of what Signature used to mean, but at least it’s something they can, pardon the pun, stretch across the brands.

[Updated 11/11 @ 746p to fix date on A318 reconfiguration date]

If you think back 15 years ago, the 50 seat regional jet was the hot commodity. People seemed to be willing to pay for jet comfort over a turboprop, and airlines raced to add as many as they could. It’s pretty much been all downhill from there. United is the latest to shed more 50 seaters as it failed to renew a contract with Mesa for the 26 CRJs that they operate in United colors. It’s just going to keep getting worse, and the regional carriers are really going to suffer.

South Park fans know that while you can collect as many underpants as you want, it’s the magical second phase that leads to the third phase of profitability. We’ve now learned that buying 50 seat jets is not the second phase:

Key to Airline Unproftability

Independence Air learned the hard way that those little guys couldn’t just magically make money for them. ExpressJet also had troubles flying under their own name. Now it’s not that every 50 seater is unprofitable. It’s just that there are too many of them out there, so they end up flying in really dumb markets where they don’t make any money. That’s why airlines are racing to get rid of them as fast as they can.

Most passengers are glad to see those things go. While travelers hate the cramped sardine can that they encounter on the 50 seaters, they forget that they were complaining about props just before that. Now, props have become much more comfortable with the Q400 and the newest ATRs. And the 70 seat jets are much more spacious as well. Even the CRJ-700 has a bigger cabin with better aligned windows than the 50 seat version, so it’s a more pleasant flying experience.

Of course, the airlines aren’t too concerned about your flying experience but rather that these things burn money. So why not just ditch them? Well they all signed deals with regional carriers to fly them, and they’re just champing at the bit to get out of those deals.

Last week, SkyWest agreed to fly 50 seaters for AirTran, so it seems like someone is interested in these things right? Not really. Instead of AirTran taking all the risk as they would under a regular regional agreement, SkyWest is doing the flying at its own risk. AirTran simply gets to enjoy the benefits of shared revenue. That’s how bad the 50 seat market is. SkyWest, a fairly well run regional, has to resort to these types of deals just to get them in the air.

And now Mesa will be in the same boat since it will have 26 CRJs that used to fly for United sitting on the ground with nothing to do. Sucks to be them. Actually, it REALLY sucks to be Mesa. Little Mesa is currently sporting a $23 million market cap. That’s right. Sell a brand new 737, buy an entire airline. The airline already agreed with United to pull 10 Dash-8 turboprops out of the United system, so these combined reductions mean about a 25% reduction in aircraft flying and an 18% reduction in revenues. In fact, they say this in their Q2 2009 quarterly statement regarding the possible termination of United’s Dash-8 and CRJ leases:

In the absence of obtaining additional capital to fund our operations through equity or debt financings, asset sales, consensual restructuring of the aircraft leases, extend United CRJ-200 and Dash-8 flying, or placing the aircraft with another carrier pursuant to a revenue guarantee contract, our cash flows from operations and available working capital will be insufficient to meet our future capital requirements.

In other words, if we can’t find anyone to take these planes, it we can’t renegotiate with lessors, or if we can’t raise more cash, we’re in trouble. As if that’s not enough, they’ve also been trying to fight off Delta’s attempts to pull out airplanes for quite awhile now as well. Things are not looking rosy for Mesa at all.

This is just going to get worse for the 50 seat operators, and Mesa appears to be feeling it worse than anyone else right now.

Cranky Concierge watches your backHartford Courant
More on Cranky Concierge. It’s picking up steam.

Delta Air Lines Rips Into International Association of MachinistsBNET
The IAM has postponed its representation efforts for Delta’s fleet service workers, and Delta is pissed.

United Seems to Be Closer to Buying New AircraftBNET
Word on the street is that United may finally pull the trigger and buy new planes. But what will they be?

getting your guests to your wedding for lessAntiBride.com
If you’re getting married, getting people out there can be pricey. Here are some tips for saving a little cash.

Therapy for delayed fliersHouston Chronicle
A great article on using Cranky Concierge. Check it out and sign up!

Continental Airlines Revenues are 15 Percent Worse Than Last YearBNET
October revenues are coming in, and the year-over-year comparisons look better but the numbers still look bad.

Ontario Airport’s High Costs Showcase Missed OpportunityBNET
A followup on Ontario Airport’s high costs shows that too many employees making too much money are putting a big burden on the airport’s cost structure.

United Airlines Looks Toward Africa for ProfitsBNET
United will start flying to Africa for the first time, and my guess is that it’s not because Africa is looking more interesting. It’s because the rest of the world is looking pretty bad.

If you’re an airline dork, Signed Southwest Timetableyou love timetables. It’s just the way it’s always been. And with Southwest finally issuing its last timetable this year, the era of printed timetables in the US has come to a close. I asked Southwest for a copy of the last timetable, and Southwest spokesperson Paula Berg did better than that. She sent me one signed by none other than Southwest legends Herb Kelleher and Colleen Barrett. Even better, she sent me two signed copies, and now one could be yours.

So how do you get this magical book of joy? Send me your best tribute to timetables. Video? Sounds good to me. Music? Excellent. Pictures? That’ll work. How about a poem? Delightful. Just get creative and submit your best. Got pictures of you as a pudgy pre-teen? That’ll work as well . . .

Can You Outdork Me?

Just put your masterpiece together and send it to me at cf@crankyflier.com by 1159p Pacific Time on November 15. That’ll give you two weekends to work on this. I’ll go through the entries and pick the winner within a week of the end of the contest. I’m the only judge, so this is rather informal.

Oh, and if you have a file that’s too big to send, feel free to upload to your favorite file sharing site and send me a link. Or, I can pull it down from your site (if you have one) using FTP if that’s better.

I realize this seems like a big task, so I’m curious to see how many, if any, entries I get. We’ll see how much you guys really do love timetables.

You cheeseheads may still be hurting from your second Favre-related beatdown this year, but you can rejoice that you now have yet another airline coming to town. SkyWest (yes, the regional airline) will begin flying for AirTran in Milwaukee.

It’s very clear that this is happening because of the AirTran deal, but it’s not your traditional regional contract. Then again, it’s not exactly the “innovative” and “groundbreaking” contract that these guys are proclaiming it is. This has been done before many times. The airplanes will say SkyWest on them, but you’ll have to go to AirTran to book. It’s a lot like the deal they had with Delta back in the day.

AirTran and SkyWest Deal in Milwaukee

You may remember that SkyWest was flying as Midwest Connect until Republic came in and booted them out. Like most airlines, SkyWest has more 50 seat jets lying around than they need, so they figured they could just put them back into use on routes they know and love. Only now, they’ll get passengers from AirTran instead of Midwest.

The 50 seaters will fly from Milwaukee to Akron/Canton (Jan 5), Des Moines (Feb 11), Indianapolis (Jan 5), Omaha (Feb 11), Pittsburgh (Dec 4), and St Louis (Dec 4). All of those are Midwest markets except for Akron/Canton, which is a big airport for AirTran. Nice.

Some of you may remember AirTran’s last effort to use 50 seat jets. Back in 2002, they signed a deal with Air Wisconsin to fly as AirTran Jet Connect. That ended in 2004 when the airline realized 50 seat jets didn’t make much money. Some are already saying that this won’t work this time around, but this is a totally different model. This will work out just fine for AirTran, though SkyWest might not be as thrilled.

Before, it was a capacity purchase agreement which meant that AirTran bought the seats to resell under their own name and Air Wisconsin received a guaranteed profit. Now, it’s a prorate agreement. SkyWest is flying these routes at its own risk and AirTran gets to share in the revenue. So SkyWest has a big burden here while AirTran has none.

If you listen to the AirTran pilots, this is the end of the world. Their press release says “Outsourcing: Bad for Business.” Hmm, not so sure about that. They do say that AirTran passengers expect to be flown on AirTran planes and that means XM Radio, wireless internet, and business class. Hmm, maybe, but they aren’t going to get that from Milwaukee to these cities.

Granted, Pittsburgh, Indy, and St Louis have mainline service from AirTran right now, so this tells me that those flights are really weak. It’s either a 50 seater that has a shot at making money or no service at all. I’d say it’s good for business with that perspective.

I suppose it’s AirTran’s fault that the pilots are responding this way. Back when they discontinued JetConnect, AirTran said they “could operate the Boeing 717 more efficiently than the Canadair regional jets in short-haul markets.” They may have thought that sounded good at the time, but now the AirTran pilots want them to stand by that statement.

Unfortunately for the pilots, that’s just not true. When AirTran started JetConnect, they served three cities – Pensacola, Greensboro, and Savannah. Only Pensacola is still served by AirTran today. I guess those 717s didn’t work out as well as they hoped on those lighter routes.

In my mind, this comes down to just a couple of things. SkyWest has a bunch of 50 seaters lying around and is desperate to find a home for them. AirTran wants to continue to put the squeeze on Midwest in Milwaukee. Combine the two and, voila, you have a plan.

Will this work? If I had to place bets, I’d guess no, but hey, I’ve been wrong before. If I’m AirTran, I love this deal since I have absolutely no risk and I get to strengthen my network out of Milwaukee. If I’m SkyWest, well, it’s the best I can get right now, and that’s scary.

[Updated 11/5 @ 809s to clarify that this won't be sold under the SkyWest code]


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