This Week’s Featured Link:
JetBlue Airways (JBLU) Robin Hayes on Q4 2015 Results – Earnings Call Transcript – Seeking Alpha
JetBlue had been lagging the industry from a profit perspective, but things are changing. Last quarter was a great one for JetBlue, but why? One thing that stood out was the huge benefit of “Fare Options.” You remember, this is the bundled fare product that introduced the lowest fare without a checked bag. That means people either had to opt for a higher fare to have a bag included or pay for the bag outright. How did these fare options perform?
“Specifically we exceeded our 80 million operating income target and believe we’ll achieve a $200 million run rate in 2016, one year ahead of our original plan.”
JetBlue’s net profit in Q4 was $190 million. JetBlue resisted charging bag fees for years, but when it gave in, it did it thoughtfully. Now the airline has significantly increased profits, above expectations, and hasn’t tarnished its image in the process.
You listening Southwest?
Two for the Road:
BA boss Willie Walsh reveals ‘We could still rescue Bombardier CSeries’ – Irish Times
Former British Airways and current IAG (BA’s parent) CEO Willie Walsh is at it again. He never minces words, and this interview shows just that. My favorite part? This is what Willie says about Richard Branson.
“I don’t like him. I don’t admire him. I don’t buy his bullshit”.
SeaPort Airlines files for bankruptcy protection, ends Oregon Coast service – Portland Business Journal
Another little guy runs into a brick wall. SeaPort is still flying, but it dropped a bunch of routes and is just trying to keep itself afloat. It said that the pilot shortage led to the cutbacks, but presumably there’s more to it when bankruptcy is involved.
Don’t listen Southwest. I like you exactly the way you are.
Wall Street doesn’t like it. How dare a business listen to its customers???
“You listening Southwest?”
Please don’t, SWA! As both a traveller and a happy shareholder, I say keep on keepin’ on, Southwest!
Who exactly flies on these short Seaport routes anyway? Isn’t it easier to just drive or take Amtrak, Greyhound, etc? There is no pilot shortage. There are plenty of pilots, they just don’t want to work for the pittance that Seaport is offering them.
Seaport was a dream to fly between Portland and Seattle: easy parking at the (very relaxed) general aviation terminal, no security checks, comfortable aircraft and friendly staff. It was well worth it in time saved and hassles avoided.
We had SeaPort and there was a lot more to their failure than pilot shortage. Don’t buy that for a minute.
I’m sure Southwest would love to do it but are afraid of the backlash, in the long run I doubt it would hurt them at all. The best way to do it would have it at a much lower rate than the others are charging and then when people
get used to it gradually increase it over time.
There is a business case to be made for SWA keeping the free bags.
1. Market differentiation. Leisure travelers love the free bags and shop SWA over the competition knowing this benefit.
But I think more importantly:
2. Operational efficiency. In my travel experiences, you see many fewer SWA passengers boarding with tons of crapola to avoid bag fees. When you add in that many of these pax are 1 or 2 r/t travelers per year, if you cram up all those bins and have inexperienced travellers wrestling with luggage, then flights push later, arrivals take longer to unload, and poof, there goes SWAs fast-turn business model.
So. Sorry, Cranky, I think you’re wrong on this one.
I flew SeaPort once (DAL to Boone County, AR). Great 8-seater EAS flight. Sad to see them hit hard times.
Still, PDX to SEA is what, only a 4 hour drive? Something similar works for Ultimate Air Shuttle out of LUK and CVG to MDW, timing flights to make for day trips for the business crowd, but I guess not for SeaPort…