Today, I want to focus on the the three US airlines there and their different strategies. It’s interesting that all may include the Boeing 717 in one way or another.

Delta the Opportunist
I was most interested in hearing from Delta’s VP of Fleet Strategy and Transactions Nathaniel Pieper. You might remember my post addressing why Delta had bought current generation 737-900ERs instead of waiting for next generation airplanes. Certainly Delta’s fleet strategy has differed from other legacy airlines.

I was particularly interested in the rumor broken by Holly Hegeman at PlaneBusiness that Delta would be acquiring the AirTran 717 fleet from Southwest. We didn’t get any details on that in this panel, but after hearing Nathaniel speak, it seems clear to me that the 717 would work quite nicely for Delta considering its strategy.

Nathaniel described Delta’s fleet strategy as one of opportunism. “We have every fleet type known to man.” That’s because Delta will go into the secondary market and buy airplanes if it makes sense. The MD-90 is a perfect example of that. Delta has been acquiring every MD-90 that’s on the market because they’re cheap to acquire and they’re good airplanes that can fly many of Delta’s medium haul missions.

Nathaniel wasn’t afraid to judge others, noting that you “won’t see us enter into a commitment for 460 firm aircraft with 500 options. We’d rather play the game a bit more conservatively, be in the game a bit more frequently and take smaller bites instead of one big chunk.” Hmm, I wonder why he picked that “460″ number. Oh right, that coincidentally matches a certain recent order from American. Heh.

What about airplanes even smaller than the 717? The news is not good. To the surprise of nobody, Nathaniel explained that the “economics of the [50 seat RJ] is very challenging right now.” As if that wasn’t clear enough, he confirmed that Delta would like to shrink that fleet “substantially lower.” What would replace those airplanes? Either fewer flights on bigger jets or some markets might lose service all together.

Hawaiian Loves Its Fleet
Moving over to airlines that actually operate the 717 today, how does Hawaiian feel about the airplane? Peter Ingram, EVP and Chief Commercial Officer for the airline has nothing but love. “For the unique flying we do of 100 to 200 mile hops in the islands, the 717 is very good…. We like the 717 fleet and expect to be in it for this decade at least.”

The more interesting fleet for Hawaiian is that of the bigger jets. In the last two decades, Hawaiian has gone from the L1011 to the DC-10, then to the 767 and now to the A330-200. Why the A330? The airplane apparently has “great economics” to the west coast while at the same time giving more range to reach more places in Asia. Since that’s where Hawaiian has been expanding, this makes a great deal of sense.

Southwest, the Simple Airline
Let’s go from an airline that loves its 717s to one that wants to see them gone yesterday. Did Southwest tip its hat about the fate of the 717 at the airline? No, but the way Brian Hirsham, SVP of Technical Operations spoke, it sounded like the writing is on the wall to me.

Brian explained that the Southwest fleet strategy has two parts. The first part is simplicity. “We realize tremendous synergies by operating a simple fleet.” The 717 hurts that simplicity argument, of course.

The second piece? Flexibility. “We have the ability to flex up and down in terms of fleet size.” Southwest will be retiring 120 737-300/500 “classic” aircraft over the next couple years and replacing them with current generation 737-700/800 instead. But if demand rises, Southwest can simply keep those classic 737s flying longer. And yes, that could happen if, say, Southwest decided to drop an entire fleet type.

In the end, everyone seemed pretty confident with their strategies, and that’s no surprise. A good fleet strategy is key to running an airline. Sometimes, what works for one airline might not for another. And that’s why I’m keeping a close eye on those AirTran 717s…

[Photo via Flickr user redlegsfan21/CCSA 2.0]

Don’t be Fooled by Hawaiian Air’s “Stellar” On-Time Performance – Conde Nast Daily Traveler
Hawaiian consistently finishes at or near the top of the on time charts, but this is really a tale of two airlines. The overwater operation isn’t so great.

In the Trenches: Working From Home with a Child – Intuit Small Business Blog
Turns out that working from home with a child is a challenge. Who knew? Hah.

PETA’s pitch is to have Hawaiian wrap an airplane to promote saving sea kittens, and in exchange, the PETA folks will sing the praises of Hawaiian to their fellow members. They’ve even mocked up the plane, but in doing so, they’ve proven that they have worse Photoshop skills (at left) than even the United/Continental merger team. You’d think they could have at least mocked it up on an aircraft type that Hawaiian operates and not a 737.

To counter such a silly proposal, I’m making my own pitch. Hawaiian, don’t do this and the rest of the world will not think you’re insane. And to help this cause, I’m giving Hawaiian some publicity of my own here. Fly Hawaiian!

I’m all for the ethical treatment of animals, but PETA goes way above and beyond. PETA thinks fishing should just simply stop. As someone who had a great day a couple weekends ago catching 27 delicious salmon (along with my brother, at right, and 7 others), I couldn’t disagree more. Fish tastes great and it’s good for you. Are there abuses in the fishing world? No doubt. Responsible, sustainable fishing needs to be encouraged, but a wholesale end to fishing? Gimme a break.

While I do support the ethical treatment of animals, I find it very hard to support PETA. This is the group that compares eating meat to enslaving black people and beating women. I’m never a fan of extremists, regardless of which side they’re on (unless, of course, it’s the pro-aviation extreme). People eat meat, and it’s not going to change. A lot of people like eating meat. A lot of Hawaiians like eating things that are supposed to be meat (spam). So this campaign isn’t going to fly.

The idea that Hawaiian would do this is just laughable. Fishing is big business in Hawai’i and it’s an important part of the culture. There are over 3,000 commercial fishers in the state and it brings a lot of revenue in. Would Hawaiian really want to do something that would hurt its core business of transporting Hawaiians? Uh, no. Maybe Hawaiian would do something to support the end of whaling or something, but . . . wait, no they wouldn’t. They’re starting service to Japan soon. That’s not a good business move either.

In the end, this seems like another desperate attempt by PETA to get press coverage. I suppose I’m obliging.

[Original cat photos via Flickr users brokinhrt2 and PJLewis]

Skepticism Surrounds Potential United Aircraft Order
United is talking about ordering new airplanes, but few believe the airline is revealing its true motivation. There are plenty of theories that make a lot of sense.

May 2009 Airline Traffic Numbers
Raise your hand if you think traffic looked good in May. If you raised your hand, put it down. You’re wrong.

Allegiant’s Low Aircraft Ownership Costs Allow Schedule Flexibility
In a recent presentation, Allegiant showed just how unique their model is. Some months, they cut capacity by more than a third. Not many airlines can pull that off.

Hawaiian Finally Showing Improvement in Mainland On Time Performance
You may think Hawaiian has great on time performance, but that’s definitely not true on their mainland flights. Fortunately, in April they finally showed some improvement.

Lower Demand and Higher Oil Prices Lead to Fall Capacity Cuts
Oil is going up and demand isn’t getting any better. That means it’s time to cut capacity once again.

Virgin America Cash Levels Plunge in the First Quarter
Virgin America released first quarter results today and cash is a concern.

JetBlue and Others See Higher Complaints in March
I said above that “most” other airlines didn’t have rising complaints. JetBlue, ExpressJet, and Hawaiian, however, did.

Premium Traffic Down 19 Percent, Revenues Down 35 Percent or More
I’m not sure why I keep looking at these IATA premium traffic monitors. The news just keeps getting worse.

American Adds One Way Awards, Cuts Stopovers
American is making their program more flexible for travelers, and I think this is a net positive for both sides.

Continental Starts Flying 737s to Hawai’i
Continental’s first move to fly 737s to Hawai’i highlights the shrinking but still important role of 757s.

AirTran’s Costs Help in the Battle for Milwaukee
At AirTran’s annual meeting, there was one slide that caught my eye. It was a cost comparison, and AirTran looks pretty darn good.

Alaska’s Shows Dropping Demand From H1N1
Alaska’s latest investor update shows some material drops from the flu scare. No surprise, of course.

Dennis Cary, the man in charge of the ancillary revenue plan at United, started off by saying that for United, “it’s unbundling, offering new travel services, and protecting and enhancing benefits for frequent fliers.” In other words, yes you’ll pay for what you used to get for free (unbundling), but they also want to add other things you’ll pay for as well (new travel services) unless you’re an elite traveler (protecting and enhancing benefits for frequent fliers).

Louis Saint-Cyr from Hawaiian had a similar thought, but he smartly emphasized the importance of the airline’s brand. Hawaiian will continue to offer free meals because it fits with their brand, but he added, “we made the free meals better and started selling premium meals. On my flight out here we sold out of premium meals. It is a hit, people love it.” It’s those types of enhanced services that make money for the airlines and make customers happy. But what about charging for things that were free? When is the breaking point?

Louis initially said there wasn’t one, because airlines would just keep experimenting and then reverse course if necessary, but then he himself reversed course. “In terms of an airline, when you diverge so much from the expectations of your customer relative to your brand, you’re done. There are things we aren’t going to touch. When you come to Hawai’i, Hawai’i itself is a brand and Hawaiian is part of that brand. You’re not going to put someone in the back of an airplane and not give them anything . . . here’s a glass of water, we’ll see you in 5 hours.”

Greg Schulze of Expedia tried to change the tune a little bit by talking about future opportunities to make money outside of the basic flying experience. “If you’re not making money throughout the life cycle, you’re really missing the opportunity. I think there’s opportunity to make revenue in places that don’t anger the customer.” A novel approach indeed, and one that Gordon Whitten of Sojern kept emphasizing. His company currently puts those contextual ads on your boarding passes you print at home, but they have many more initiatives involving targeted advertising to fliers, most of which won’t drain your printer cartridge.

Dennis didn’t really pursue that line of discussion and instead brought it back to the core product. “When we can create products and services around the core travel experience that add comfort, convenience, and more, that’s how we can create a different financial outcome for the company.” Louis however, agreed with Greg and said that he thought the big money was outside the cabin.

My favorite topic of the day was when they began discussing when airlines would finally get to the point where people could arrange this at the time of booking and wouldn’t have to keep whipping out credit cards for everything as they go.

Louis liked that plan. “I love that idea. What we’re trying to do is migrate toward the website. If I was able to eliminate all transactions on the airplane and do it on the web, that is absolutely doable. It’s just a question of getting there in the next 12 months.” That seems a bit extreme to me. You’ll always have people who want to buy on the plane, so you need to offer these options at multiple stages, but at least he’s on the right track.

Dennis agreed as well. “Go check out united.com/traveloptions and the direction you’re going is the exact analogy that I’ve been using with my team over the last couple years.”

But all this talk about airline websites ignored one very important thing. Greg shot back with a warning. “The great majority of customers who are impacted by baggage fees [leisure travelers] are going to sites like TripAdvisor, the TripAdvisor metasearch site, by far the most popular feature of that is the fee estimator. Airlines need to remember that not everybody is a 1K [United's top elite status tier] and not everybody shops on united.com.” Good point, but the discussion never touched on when online travel agents would be able to handle that type of transaction. My guess is that it’s a long ways away.

In the end, there wasn’t much talk about including everything in the price of the ticket as it used to be. But it is clear that airlines will continue to try new ideas and reverse course on others as they search for what people are willing to pay for and what they aren’t.