JetBlue Cuts February, Allegiant Plans the Summer, and Delta Retaliates

43 comments on “JetBlue Cuts February, Allegiant Plans the Summer, and Delta Retaliates”

1. It’s nice to see DL finally playing a little offense.

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2. Delta is now in an unaccustomed defensive posture. Two carriers with lower costs, JetBlue and Southwest, are prodding the Widget. Delta has a long history in RDU and is unlikely to allow either the virus or another carrier to distract it there. However, JetBlue is forcing Delta to add capacity there when it most likely really doesn’t want to.

   Southwest is gently poking around in Atlanta. By no means a full-scale assault (not enough gates for that), but a few exploratory probes, checking the enemy’s defenses. If the aviation authorities in Atlanta truly wish to provide the citizenry any truly meaningful competition, they will arrange for Southwest to take the other half of Concourse C. That would give Delta 2 1/2 Concoures of domestic gates and essentially all of the international concourse against Southwest’s one concourse. That would ensure Delta’s continued dominance in ATL while allowing for more competition in the local marketplace.

   Delta’s single flight addition to HOU is a token gesture, but the build-up in FAT is more meaningful. Evidently, Delta feels they must defend SLC at all costs. That only leaves Southwest to run its FAT traffic through LAS, PHX, and/or DEN.

   As I predicted after Delta’s Thanksgiving Day turkey (well-discussed by Mr. Snyder), Christmas would be another operational black eye for Delta. At least this time they can hide behind the weather, but the crew training issues remain palpable and entirely problematic.

   Before concluding, a healthy discussion was underway about Delta’s acquisition vs organic growth strategy last week. My debate partner, Mr. Dunn, corrected me that both SEA and BOS are Delta organic, non-acquired, hubs. Actually, Delta acquired BOS not once, but twice. The first time they bought BOS was in the Northeast acquisition and the second time (to a lesser extent) was via the Northwest acquisition. Northwest even had a crew base in BOS, certainly indicative of its importance. So this begs the question: How many times does Delta have to buy Boston to be the dominant carrier there? As far as SEA is concerned, I’m somewhat more likely to give Mr. Dunn a free pass on that, however I don’t think we can call it a true hub when Delta had to abuse its code-share agreement with the incumbent local carrier, Alaska, to reveal its true intentions. In other words, code-sharing with an airport’s dominant carrier doesn’t give one a hub.

   Regardless, Delta now finds itself on the defensive, an unaccustomed position. I predict they will successfully defend their turf because they have no choice. They are the dominant carrier by market share in their hubs and that must be protected at all costs.

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3. B6′ cuts are the most notable. All of the talk about how they would grow on so many fronts including RDU is becoming so much hot air. B6 is now the industry poster child for announcing routes and then withdrawing them. Their all over the board (and continent) attempts to grow aren’t working esp. in markets where they are the fourth largest carrier or smaller – and that is the case in many of the markets they are adding.

   Delta has generally been much slower to respond to competitive capacity additions and do it in a more measured way that other carriers. When you are the most profitable airline on the planet for years running in a row, you have to be careful about how your actions might appear.

   RDU in its entirety made up about 1% of DL’s system capacity in 2019. The amount of flights they are adding back – close to March 1 where they are selling close to a full schedule in many markets – is less than a rounding error.

   Delta’s capacity ranking among competitors in all of its hubs and is still unchanged in Feb and March.

   In contrast, WN starts service to ORD in Feb and adds IAH in April, both of which add flights to/from AA and UA’s top metros and/or airports. WN’s expansion of service into AA/UA hubs including ORD will be the most significant competitive event in the US airline industry for 2021. Given that WN adds new routes within months of starting, just as they did in MIA, WN will be operating in even more top ORD markets before 2021 is over.

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   1. DL’s capacity is artificially kept high vs competitors because they have 70% seat cap. When demand comes back more, competitors will be adding more flights and DL will be lifting their seat cap. DL didn’t have enough pilots that are current to run its Christmas schedule! This is in contrast with other airlines that have bunch of pilots getting paid to sit at home waiting to fly.

      As for RDU, JetBlue will add a lot more flights here going forward and continue to trim flights based on booking numbers. I don’t think DL bringing back 1 route and adding a couple of more flights to Florida will be that concerning to JetBlue. It would be surprising if DL did nothing. I doubt DL’s decision regarding RDU is actually dependent on what JetBlue might do.

      DL made it’s big retaliation to JetBlue when it entered BOS. There really isn’t much DL can do to scare JetBlue at this point. That’s the reality for an airline that will be smaller for several years because it saw drastic reduction to its pilot seniority list. Just think about all the training event to get those 1700 UNA pilots to be able to fly again and all the cascading training events up the chain. Then think about how many new hire classes it would take to replace all those retired pilots. JetBlue does not have that problem at all. It will be back to pre-COVID capacity sometime in 2021.

      DL’s biggest concern from JetBlue remains in NYC and the shifting demand from LGA to EWR and JFK (especially EWR). NK just got a gate from DL at EWR (down to 4 gates now?). DL has bet its farm in NYC on LGA/JFK. While JetBlue growth at EWR will certainly hurt UA more, it will certainly also hurt DL as EWR continue to become more popular with the new T-1, more airline choices, more offices moving from Manhattan to NJ and future PATH extension to EWR.

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      1. B6 can’t fly the schedule it flew pre-covid plus all of the new routes it has launched. Period.

         DL didn’t retaliate against B6 in building a BOS hub. Average fares from BOS before the DL hub were higher than JFK to many of the same markets. B6, like AS, decided to dump a bunch of capacity into the market (BOS and SEA, respectively) to try to force DL out. Didn’t work. DL consistently grew its presence in both new hubs and never expected to be the largest carrier. They did obtain 70% of the local market revenue from SEA that AS has and during the summer 100% of B6′ local market BOS revenue.

         Global carriers offer benefits that some travelers want that low cost carriers can’t match – and that will be true after covid.

         AS has figured out how to focus on what it does well including on the west coast and esp. the PNW.

         B6 is running all over the country trying to come up w/ a strategy that will work and jumping into competitive market share battles with multiple carriers. They won’t succeed at half of the stuff they try even though go to sleep w/ fantasies of B6 with “hublets” in multiple cities around the country. In the meantime, they are burning more cash as a percentage of revenue than any other US airline.

         In contrast to B6, WN is making laser-focused moves into competitor markets and will not only succeed but will take significant share from where it is adding capacity – AA and UA hubs.

         B6 would do well to follow WN’s model of expansion.

         And WN is still much smaller than it was in ATL than when it took over AirTran. It currently does not fly to the west coast – the first time any #2 airline in ATL has not done that. For at least Jan and Feb, ATL-LAX, the largest ATL to west coast market – is being served just by DL and NK; AA and WN aren’t there any more.

         WN knows what it does well and focuses its efforts there. B6 would do well to learn that lesson

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         1. DL’s move in BOS was a retaliation against B6’s entry into BOS-ATL/LGA. Right after LGA/ATL news came out, DL made their own announcement that BOS is very important to them. I don’t see how much more obvious it can get than that. You can keep repeating your stories of DL successes in BOS/SEA. They ran very low margin in both places. Any airline with gate space and plenty of cash to burn can build their market share. Nothing too different from what JetBlue did at BOS back in 2008 and is planning in other places now. The question is where they can turn it into profitable long term. Thus far, the only major success story for DL on that front is NYC. Unfortunately for DL, it’s LGA/JFK success has been stopped by COVID and the shift in demand over to EWR.

            As we discussed previously, JetBlue will be smaller in BOS for a while. Those short haul business market has 0 demand right now. All that E90s need to move to operate somewhere. That’s where RDU comes into play. Also, they have completely shifted their attention from MCO, so that will be smaller for a while too. FLL might come back to pre-COVID capacity a little sooner. NYC is where the growth is where most of JetBlue’s attention will be in 2021. It will be where they gain market share and customer loyalty from rivals. Maybe it will be mostly former AA customers, but I’m sure they will get some from UA/DL also. JetBlue already has the best product in the market. It’s going to start flying to Europe and already flies to South America. Let’s say they add lounge in a couple of years. Once JetBlue starts to offer competitive schedule out of EWR to within perimeter destinations, what else does DL have over JetBlue in NYC?

            Of course, you are going to take issues with JetBlue’s strategy. Anyone that makes an attack at DL focus city/hub is making the wrong move. Anyone that picks a fight with UA or AA is making the right move. All of the big 3 will take time to recover due to reduction in business and international demand. They’ve all made huge reductions to head count. Whether you are ULCC or B6 or WN or AS, you have to make network decisions based on where the opportunity makes sense. RDU makes sense for JetBlue. AS being conservative makes sense for them, because PNW demand hasn’t fallen as much as NYC/Boston.

            DL cannot expect to leave RDU business markets for 2 or 3 years and nobody to come in. If JetBlue doesn’t jump in, it would just become a ULCC breeding ground. Either way, your vision of DL retaining and growing its market share everywhere is simply not realistic. DL cannot expect to do nothing at AUS and expect itself to still be relevant in 3 years time.

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            1. As much as you want to believe otherwise, B6′ margins fell after DL started building its hub while DL’s grew. DL built its hub because it saw opportunity while B6 tried to run them off and only hurt themselves.

               RDU is still a very competitive market just as it was before covid. AUS-RDU was flown by DL and WN. DL is the only one of those two that is restarting the route. AA flew RDU-LAX but is not flying it now while DL has continued that route. RDU to Florida was very competitive, still is and will be and B6 will be smaller than any of the big 4 – not in a great position to think they will be able to move the dial – just as at LAX.

               Your view of the world is clearly distorted. B6 has gone from one of the financially stronger US airlines to now being far more vulnerable even while taking on every one of the big 3 plus other carriers.

               Let’s see how it all works but the chances of B6 succeeding at all it is adding is alot closer to none than slim.

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               1. Your AA examples of LAX-ATL and LAX-RDU as an example of “gave up on this market…” are a bit hollow given that they’re literally IN the schedule to start back in March. Not to mention, Delta is only going daily on RDU-LAX once AA is back on the route… You insinuate that AA has given up on these routes. They haven’t, at all.

                  Are we to assume Delta has given up on every market that they aren’t flying in January or February? RDU-CDG? RDU-AUS through mid-February? RDU-ORD until April? RDU-MIA until April, RDU-DCA until April (much more important local business markets than LAX-RDU)… Of course not… If Delta wants to fly LAX-RDU at a loss in January and February, good for them. not Flying a market means nothing during the expected peak of a pandemic.

                  If you’re going to talk about Delta in RDU as though they’re the only ones that haven’t given up on the market, it would be a more interesting discussion if you discuss all the routes Delta has eliminated in January, February, and March.

                  Otherwise, it goes to your normal talking points and method of argument of ignoring all the aspects of your line of thinking that say the same thing about Delta in a respective market…

               2. I don’t see my optimistic outlook for JetBlue to be any different than other people’s optimistic outlook for the airline they like.

                  The reality is that JetBlue did not make any purchases into other airlines pre-pandemic, so it had a better cash position than all except WN. That financial position has allowed it to act quite out of character during this pandemic and behave more like F9. The other reality is that adding these additional route has allowed them to access a much larger revenue pie. They have a lot of aircraft and pilot sitting around doing nothing. That’s very expensive. For a market like RDU, they don’t have to get a lot of bookings to exceed the marginal cost of flying the aircraft. And if they don’t get enough advanced bookings, they will simply just trim schedule 6 weeks out.

                  I think you should read your posts carefully and see how they come across. Your objections to JetBlue’s moves are that they responded to DL’s buildup are BOS and that they are building up in RDU when DL has trimmed all business market flights. That comes across as saying “anytime a competitor responds to Delta, they are making a mistake and everyone should retreat when DL expands”. That is an extremely arrogant point of view.

                  I don’t expect all of JetBlue’s new routes to work out, but I expect them to keep a good portion of them. If you can make the argument that JetBlue shouldn’t be adding any routes while bookings in nyc/boston are at 25% pre-pandemic level and gov’t is paying salaray of workers, I’d love to see it.

               3. Jake,
                  your point is somewhat valid – except there are so many routes that AA is not flying that other carriers are flying now, it is beyond believable that AA will re-add all of them, esp. since some of them including from JFK were not consistently flown post covid. No airline can expect to reclaim everything it has not flown while other airlines have continued the same markets, regardless of whether they are still publishing schedules in those markets or not.
                  LAX is the real market to watch post pandemic WRT AA. But let’s not pretend that they did the same thing post 9/11 from JFK and the same thing is developing again in multiple markets.

                  FC,
                  we have come as far as we likely can re: this discussion. B6 moved into BOS because it had been virtually vacated except to/from hubs by all of the legacies post 9/11. That is not the case with RDU, MIA, LAX or most of the other markets that B6 has recently entered.
                  DL didn’t retaliate in building BOS. They built a hub because they saw value. B6 and DL are publishing the same percentages of BOS capacity right now as they were pre-covid.
                  I will strongly bet that B6 will operate a smaller percentage of the routes that it has launched since the pandemic started one year from now than any other airline.

                  You can look at the track record of each airline over the past 20 years – the most turbulent for the remaining legacy carriers (and as long as B6 has existed) and then look at the next year and come to pretty strong conclusions.

                  I will also strongly predict that B6 will be weaker relative to its direct competitors one year from now than they have ever been.

                  You, of course, are free to come to a different conclusion.

               4. I don’t see how you can look at RDU at the moment and now see it as vacated by Delta. DL has not operated any non-hub/leisure market since April! They are at 16 flight a day during Christmas holiday season even with 70% seat cap. AA is going to be gone from JFK-RDU and never going to start BOS-RDU. There is a huge vacuum left open. If B6 didn’t add routes here, WN or any of the ULCCs would. Other airlines are not going to wait along for Delta to be ready.

                  MIA is not a real network move. It’s about south Florida strategy and grabbing a portion of the recovering leisure pie. You have to add flights to where the money is right now. And that is Florida.

                  LAX thus far has just been beefing up mint schedule + adding a few long/thin transcon/international flights that will fly when there is demand. LAX is not going to get full attention until NYC gets built back up and when A220 is in service in large enough numbers.

                  As for your other comment about JetBlue being weaker a year from now, that could happen. However, that would be due to NYC/Boston demand dropping rather than any of the route they are trying. They are only operating flights that are can cover the cost of flying. If LAX flights can’t cover their cost of flying, they don’t get flown. JetBlue can easily cut those SFO/AUS adds in the next few months without any damage to their network. They can cut those RDU adds if they don’t think it will work out. Just adding LGA/JFK slots + expanding in EWR alone will be a huge improvement to their system already.

                  I also don’t understand your continued obsession with DL market share in Boston. At this point, Boston demand is way down. But when there were some leisure demand like during Christmas season, JetBlue was running twice as many flights as DL. It’s quite clear Boston will come back very slowly for JetBlue. In fact, JetBlue might operate more flights out of FLL/MIA/PBI than Boston for a while. If Delta is as concerned about its BOS market share as you are, they can fly as much out of Boston as they want.

               5. If you want to believe that any carrier can enter markets that other carriers operate and the “invading carrier” can simply insert itself into the market with no change in competitive dynamics, then you clearly have not been following the industry for any length of time or else choose to ignore basic market principles that have nothing to do with Delta, JetBlue or any other airline.
                  Whether DL is flying all of its previous capacity and routes from RDU or not does not mean they are willing to see another carrier set up in those routes. And the same principle applies to whether AA drops RDU routes or not. The same principle applies to EWR and what UA does or AA and what they are doing in MIA.
                  I am not obsessed with DL’s capacity in BOS; I have repeatedly said that DL’s capacity ranking in its hubs and focus cities – which include BOS – is unchanged.
                  B6 is not the heir apparent to AA and you can absolutely be assured that no other airline believes it even if you do and if AA thinks by walking away from those markets, B6 will succeed.
                  If B6 focused on ONE or at most two new potential focus cities, they might succeed. But there is no way that B6 is going to succeed in all of the markets they add including from RDU.
                  And the very reason why B6 is bleeding as much cash as they are is because they are NOT covering the basic cash operating costs of the routes they are flying. Given that their cash burn has accelerated since they started adding new routes, the chances are very high that their expansion is not working – but we won’t know that for years.
                  Delta and United both are being very restrained in adding new capacity right now because it makes little sense to get into market share battles right now with little demand – and what is there is heavily leisure.
                  If you want to believe that B6 can succeed, don’t let me take that from you. Just because BOS and NYC demand might take time to recover doesn’t mean that other carriers are going to lie down and not protect their key markets, you will be very surprised at what will happen. It has nothing to do with DL or any single carrier. It is the way the industry has operated for decades and I can assure you it won’t stop now.
                  Can we check back on this discussion at some point in the future? I think we have both made our points at least a couple times.

               6. Dunn > If you want to believe that any carrier can enter markets that other carriers operate and the “invading carrier” can simply insert itself into the market with no change in competitive dynamics, then you clearly have not been following the industry for any length of time or else choose to ignore basic market principles that have nothing to do with Delta, JetBlue or any other airline.

                  It is a little frustrating how you automatically expect Delta to beat back any JB incursions, but you don’t say the same for UA at EWR. Why would they be any different?

                  Cranky, your network weeklies are awesome, especially catching the competitive responses like Delta this week. Has there been any evidence of a competitive response to JetBlue at EWR by United? It seems like something that might be more below the radar – not new routes, but new capacity and more competitive pricing on matching routes?

               7. Tory – United has done a little, but they haven’t gone scorched earth with schedules. I think the reason is that they probably aren’t filling all the flights they have anyway, so they’ll compete more on price. But I guess we’ll find out when DOT data rolls in.

               8. Tory.
                  I have repeatedly noted that both DL and UA are being slow to respond because there is little value in getting into market share battles when there is very little demand.
                  I have indeed said that I expect United to get more aggressive to B6 but I still see B6 as being successful in setting up a decent presence in EWR.
                  EWR is a much larger market in RDU and it is also much more concentrated than RDU. it is much easier to take a piece of EWR than RDU.

                  and regarding your comment below, I’m not sure how long it is going to take for some people to understand that AA and B6 are competitors. AA started this whole “partnership” to provide feed to AA international flights in markets where AA cannot make a profit.

                  AA has ZERO incentive to keep turning over valuable markets to B6 esp. in markets like AUS. AA has been badly managed but surely even Vasu recognizes that they can’t codeshare away their most competitive markets and expect passengers to continue to choose them. And, as we have seen with MIA, B6 will take a mile if you offer them an inch – and no one should doubt that AA is far from pleased with B6 with the MIA new routes; airlines don’t add a bunch of new parallel routes in another carrier’s hubs/focus cities because they are developing a partnership.

               9. Of all the projects they have going, EWR is clearly far and away the most promising and likely to succeed. I don’t think anyone can argue against that. JetBlue’s brand recognition is very high not only in Manhattan but also NJ. There has always been the saying among Jersey folks that they have no option other than UA. It’s also a reason why a lot of people that live in Northern NJ and work in Manhattan fly out of LGA rather than EWR a lot of time. The big shift going on in this area is that people no longer need to avoid EWR, since there is the additional B6 option here for a lot of routes. At least, I expect that to be the case by the time T-1 opens. There is also the possible PATH extension which would make EWR more convenient than both LGA/JFK. Also flexible WFH policies and companies opting for decentralized offices vs 1 big office in Manhattan means that a lot of people will work in NJ (whether in an office or at home) going forward. That’s a huge hit on LGA traffic. There is also the argument that large chunk of people that have the disposable income to fly have moved from Manhattan to NJ, CT and Long Island. That may take many years of new money to be reversed.

                  At this point, JetBlue has to look at NY aviation landscape and figure out how real and long lasting is this shift to EWR. If it’s not a short term shift, then they really need to go all in. That means trade whatever it needs to trade at JFK to get as much of T-1 as possible. UA wants a permanent home at JFK? Sure, we will trade them 20 slots and 4 gates + plenty of lounge space. In exchange, we want 5 more gates at T-1. That’s the biggest decision for JetBlue to make in 2021. It’s the difference between 80 to 100 flights at EWR vs 120 to 150 flights. I think UA will be hampered in EWR permanently regardless of their decision. But a 135 flight B6 station would mean UA is at 300 flights for most of the year. Similarly, if LGA is no longer the preferred airport to downtown/midtown Manhattan, that would be a huge hit for Delta. If you don’t think AA is happy to see DL take a huge hit on their profitability in NYC, you probably have not been focused on what DL has been able to do with all its money.

                  And more importantly, AA’s partnership with B6 helps it in medium sized markets across the country since they will get service now to all NY area airports + BOS. That is going to be damaging to DL’s ability to win those ff and cc holder in midwest and East Coast. There is no way AS can help AA in this area as much as B6.

                  For all the comments about BOS and RDU, JetBlue’s EWR move and AA partnership will have far greater affect on DL. That’s why our friend is so insistent that AA will not move forward with the deal.

                  MIA move is a blip in radar compared to the agreed to Northeast partnership. Their move into MIA is part of their overall south Florida station. You can’t pretend they weren’t already competing heavily with AA in south Florida before this.

                  RDU is a nice to have compared to EWR. It’s currently a very small investment compared to what they’ve done at EWR. They need to get those E90s in the air. If the bookings aren’t there, then they just trim the schedule. There is no downside to this move. There is clearly a vacuum there. It’s better to go in now with a bang vs in 2 years when DL’s mostly recovered. If bookings are not there when airlines are no longer able to trim schedule 6 months out, they can always cut all routes outside of JFK/EWR/BOS/FLL/LAX/SJU/MCO/TPA. That would still be one of their largest outstations. Nothing would’ve been lost here.

                  Given the vacuum that has been left behind by DL, I think RDU is the likeliest target for them to be able to expand beyond the northeast/Florida bubbles. It’s their most likely avenue to build a sustainable focus city. Remember, JetBlue has managed to build up BOS and FLL into sustainable focus cities from very little. I expect JetBlue to add more routes here in 2021 like BDL/PHL/PBI/SAN. We will see what DL chooses to do here. I think there is a chance that DL will not bring back most of the business routes it has trimmed since March.

                  LAX is a bigger investment than RDU. That’s an indication of their desire to be a national carrier. LAX gates are notoriously hard to come by. I think a lot of the routes they’ve added so far are to show LAWA that they are trying to expand and require those additional gates that were promised. I don’t expect any major buildup in LAX until 2023 when they have enough A220 in service. The economics of A220 will make these long thin transcon and west coast flights a lot more workable. The next 2 years is about building up NY/NJ and then the rest of east coast.

                  For all the talk about JetBlue taking too many chances, Delta is engaged in very expensive market share battles in SEA, NYC and LAX still. DL fans cannot expect to always be the aggressor and get offended when other carriers fight back. That is extremely arrogant. The reality is DL will be smaller for several years and the LCCs (especially ULCCs) will be growing during that time.

               10. FC,
                   you continue to make many assumptions, and there is far from certainty that most will be true.

                   – As much as you want to believe that LGA won’t return as a viable airport (because B6 has a minimal presence there), it is an airport which means it can serve any number of airlines and routes. Airlines are concentrating service at JFK because LGA is a massive construction mess and because there is more critical mass that can be achieved at JFK than LGA. LGA will be back. The Port Authority cannot invest $4 billion just on its part of the new LGA – on top of DL’s investment of roughly the same size – to allow LGA to fail.

                   – AA is still the 2nd largest slot holder at LGA and is flying a lower percentage of its LGA AND JFK slots than DL. DL stands to gain more from a smaller AA in NYC.

                   – Please list the markets where AA has its code on B6 flights and vv. As much as you continue to want to believe that AA will cede market after market to B6, they simply are not that stupid. They saw what is happening with MIA and very likely will move much slower if not downright cancel the whole thing. If AA needs to sell assets, B6 will not likely be the highest bidder – hint, AA’s N. Texas rival has a better chance of winning AA assets in a bidding contest or government order than anyone else.

                   -B6 can’t succeed at all it has laid out. No airline could and no airline has tried what B6 is trying all at the same time. They are throwing spaghetti at the wall trying to find some revenue but have made themselves the target of every airline because they are losing so much money right now compared to the rest of the industry.

                   – Feel free to post data about how expensive DL’s market share battles in NYC, LAX and SEA are. You can’t because it is internet lore. Delta built all of those hubs over decades and ended 2019 with a net income margin just tenths of a percent below WN. All DL has to do is sit back and let other carriers melt down fighting between themselves to end up stronger in the same markets it had pre-covid.

                   – The A220 won’t be B6′ saviorif it is the aircraft type that will make or break a route’s success. DL has scores of them already and will have the better part of 100 before B6 gets more than a dozen.

                   Please make sure you put your predictions about B6′ incredible growth on today’s post.

      2. “Just think about all the training event to get those 1700 UNA pilots to be able to fly again and all the cascading training events up the chain. Then think about how many new hire classes it would take to replace all those retired pilots. ”

         It’s a huge job to get everyone settled in whatever seat they are moving onto. That’s a given when /literally/ every pilot on the system list is subject to displacement (The #1 pilot was on the 777).

         As for NH classes, I think you’re assuming DL will replace everyone that left immediately. I see it being a much slower burn. The company itself has repeatedly stated that they plan to come out of this as a smaller carrier.

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      3. FC – As I mentioned on a similar thread a couple of months ago (and am repeating here), I feel you are tending to overstate any extent to which LGA may lose “importance” in the region. The facility will certainly not be any less important. I feel this is because:

         • Both overall population and business locations are not decentralizing nearly as much as people think they are – and they likely (in my opinion) won’t in the long-term. Most people that moved out of Manhattan went to – wait for it – Brooklyn. Another borough, and one which is still closer to LGA than most people realize, especially compared with EWR. Will there be some changes? Yes. Enough to likely alter the overall market share (in terms of O&D passengers, not total enplanements – you might be surprised at how close LGA and EWR are to each other in terms of O&D passengers) of each of the three major New York City metropolitan area airports? Likely not in any significant manner.

         • Traffic congestion throughout the region is such that LaGuardia will still be significantly closer (in terms of travel time) to Westchester and Connecticut than either JFK or EWR. So, even with some measurable “decentralization”, LGA will still have some geographic advantages, particularly to certain parts of the region, and particularly for flights whose stage lengths are relatively short and ground travel time needs to be minimized.

         • Also remember one additional interesting tidbit: LGA’s natural “catchment area” essentailly extends past New Haven and almost hits the Hartford area. Commercial airports in the northern New York City suburbs (i.e., HPN) simply don’t offer the same market opportunities/direct flight options that LGA does. But, as you head a similar distance south and west away from EWR, you start to approach reasonable enough travel times via the Walt Whitman Bridge and the NJ Turnpike/I-295 to PHL – a large American hub – that make PHL a more viable alternative to EWR well before any simlar alternatives pop up to LGA in the northerly direction. The presence of PHL (i.e., a Princeton area traveler essentially can play EWR and PHL off of each other, whereas a Greenwich or Stamford area traveler is going to LGA or JFK, but not to Bradley Field north of Hartford) means that LGA’s location (and – to a lesser extent – JFK’s location) puts it in a slightly better position vis-a-vis EWR and its relative proximity to PHL.

         • The new EWR Terminal 1 – while a great improvement in terms of the passenger environment – actually has fewer gates than Terminal A (which will be demolished), as I understand it, resulting in a net loss of contact gates at EWR. Terminal A has 35 gates, while Terminal 1 will have 33. Not a huge decline, so let’s just say it’s “a wash”. The Terminal B reconstruction at LGA similarly is a great improvement in terms of the passenger environment and also has the same number of contact gates as the old terminal it is replacing. However, the new Delta Terminal C – again, as I understand it – provides additional contact gates relative to Terminals C and D, which it is replacing. So – in terms of relative importance – I would certainly not say the new Terminal 1 provides a specific competitive advantage to EWR over LGA.

         • It should be kept in mind that the PATH extension to EWR would go only as far as the Northeast Corridor rail connection station at EWR – riders would still need to transfer the EWR AirTrain for access to the terminals. While an improvement in available options, I feel it does not provide any overly significant advantage to EWR relative to the connections provided by the similarly proposed LGA AirTrain, which will connect with both the subway’s Flushing Line and the Long Island Rail Road’s Port Washington Branch at Willets Point. The connection with the Port Washington Branch is key, as – with the soon-to-be-completed East Side Access project – LIRR riders will be able to access either the west side (Penn Station) or the east side (Grand Central) of Midtown. So, again – I would not say the new PATH extension provides a specific competitive advantage to EWR over LGA.

         As in November’s post – these are just my thoughts!

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4. Cranky, is Fort Lauderdale to Palm Springs the longest, thinnest, craziest domestic US route you can think of that an airline has actually tried?

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   1. Tried is a strong word since I’m not sure they will ever actually fly this route.

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   2. Jimmy – Yeah, I think so. I mean, there have been other crazy ones, like when Skybus tried Columbus to Burbank, but even that has more traffic than Fort Lauderdale to Palm Springs. This was entirely a stimulation play.
      They were hoping that if they built it, travelers would come.

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5. I think the AA paragraph should be updated slightly. Trump signed the bill yesterday, right?

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   1. Jake – Yep, it was signed after I put this to bed. I added a note.

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6. the problem with JET BLUE flyt from BUF to LAX is there is a lot of Canadian passengers.The US-CANADA border is still closed.

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7. I’ve personally stopped booking B6 flights until the pandemic is over. Twice B6 has cancelled the route I’m flying less then one month out and given me no alternative options to travel to my destination. I had to take a refund and book a more expensive, close in ticket on a competitor.

   This is why I think this talk of B6 hublets in RDU and AUS is not realistic. Why would a passenger choose to be loyal to B6 from those stations, when many of the majors fly the same routes B6 does and have the ability to connect pax who need a different schedule or want to go to a destination without a non-stop via frequent service to nearby hubs like DFW and ATL?

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   1. Well, good news is that leisure bookings for late spring to summer have been doing well recently with the vaccine optimism. For an airline like JetBlue, they are probably going to be flying over 80% of their pre-pandemic capacity by July/August and close to 100% of their pre-pandemic capacity by end of the year. Which means, their last minute schedule trimming will be a thing of past in a couple of more months.

      Also, I think RDU and AUS are different situation. RDU is a realistic focus city project that could eventually connect northeast traffic to Florida. They could realistically become the largest carrier there or at least about the same size as AA/DL. AUS is just a market they are adding some P2P flights to. They will never be more than 3rd or 4th in that market. You could’ve made the same argument on why passengers would choose B6 back in 2010 out of BOS, but they managed to build that up over time. And now, they fly to a lot more places and can get you to destination via JFK/BOS/EWR/FLL. And they should over the next year or so be able to interline with AA. Once they have that, they can put passengers to destination on AA in the event of cancellations.

      If JetBlue is building a focus city at RDU, I cannot imagine an scenario where it would be offering fewer destinations than DL. That has been its main draw out of BOS and the path it would need to take here.

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      1. Agreed. I cant imagine B6, AA & UA all just sitting there wallowing in sorrow while Tim Dunn Airlines dominates the world. B6 maybe smaller than the others, but it’s far more nimble & can react to market changes far more rapidly.

         As for RDU, that is a ever changing market. Thanks to the former Midway Airlines, it has been proven that a focus city could succeed there & now thanks to the halfbacks that have relocated it is B6’s opertunity to take advantage of what lands on the runway for them.

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         1. Howl does Midway Airlines prove a RDU focus city can be successful? They went bankrupt for a reason.

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      2. I don’t see B6@RDU as analogous to B6@BOS in 2010 in anyway other than being a fragmented market.
         a) B6 had a geographically useful 250+ flight hub in JFK to compliment BOS. B6’s current hubs are useless to RDU flyers.
         b) B6 was maxed out at JFK so it used BOS to open up new stations. It actually connected its NYC base of travelers over BOS to many cities.
         c) BOS metro is about 4x the size of RDU so it can support multiple frequencies on many routes based on O&D alone while RDU might be able to support one A220 frequency on most routes (and this is why you need to have a nearby hub – schedule options). High value travelers are not going to design their itineraries around B6’s one flight on a given route.
         d) Other carriers were busy merging and rationalizing capacity in 2010 so B6’s Boston buildup was basically ignored. That won’t happen in RDU under the current climate.

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         1. JFK has never operated 250 flights or even 200 flights a day. B6’s current focus cities are actually quite relevant to RDU flyers since NYC is far away the largest market out of RDU and Boston is the second largest and MIA/FLL is the 5th largest. Just by connecting all 3 NYC airport to RDU, they could run 15 flights a day. If you are referring to distance away from RDU, NYC is 463 miles away, BOS is 625 miles away, Miami is 700 miles away and ATL is 356 miles. I don’t see how the extra 100 mile along will make NYC that much more undesirable than ATL. Now, the delays at JFK/EWR would be a legitimate reason to not want to connect there, but having a lot of flights to EWR/JFK/BOS/FLL would make connections easy to rest of the country. It would also make connections to Latin America and Europe easy. This is another reason why RDU is a realistic focus city for JetBlue but AUS is not.

            There were normally 6 E90 flights a day from JFK to BOS, with about 80% LF and about half of that were connections. You are overstating the number of people from NYC connecting at BOS to rest of the country.

            B6 being maxed out of JFK is also overstated. They were not fully utilizing their slots even pre-COVID. In Boston, they saw a market open up that’s very fragmented and with a lot of O&D and no dominant legacy carriers. That’s also the case now in RDU (it’s 1/3 BOS’s size by domestic PDEW and growing very quickly). RDU also has the advantage of being outside the very busy northeast corridor and conveniently located for connection. JetBlue really needs to move beyond northeast and Florida. RDU is also located far more conveniently for domestic connections. Also, they are going to start off by building RDU with E90s because a lot of them are sitting around doing nothing. While E90 is suppose to leave service in large numbers from 2023 to 2027, JetBlue has a bad habit of constantly being behind on schedule in fleet changes. We can expect E90 to be the primary driver here for the next couple of years.

            I actually cannot think of a better time than now for them to build up RDU. AA is retreating to hubs. WN is busy establishing BNA as its main SE station. DL is busy bringing back its primary hubs and have not operated any non-hub/leisure market since start of pandemic. They are unlikely to do so other than the odd retaliations. RDU is clearly low in their priority list. There is a huge vacuum here.

            It’s hard to definitively answer whether now represents a tougher environment to build up new market than 2010. But can you imagine another time when it would be easier to enter a growing market like RDU. If they wait until NYC is fully recovered, what will RDU look like by then? Will it be full of ULCCs? Will DL have returned? They are taking advantage of DL vacuum right now by adding as many destination as possible and trying to make them self an option alongside AA and DL.

            There is also still the question of B6’s partnership with AA. There is speculation that deal might expand beyond Northeast and RDU would be a good place for that expansion to happen.

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      3. FC: While I agree RDU is JB’s best target, I still could see a reasonable play to get to #3 in AUS, contingent on getting a fairly good loyalty partnership with AA. The basic pitch is for AA loyalty fliers to take JB nonstops from AUS when they’re available instead of routing through DFW, and still earn their AA miles/status. Same pitch at RDU: “fly us nonstop when available, otherwise there’s always AA thru CLT or DFW or ORD.” I’ve gotta think AA sees this threat coming though… really curious how the partnership details play out.

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8. I just landed in JAX, a large spoke airport (over 8m pxs in 2019) with significant LCC and ULCC presence (Southwest, JetBlue, Frontier, Allegiant). DL has been here over 70 years and historically has the largest market share in a very fragmented market (24% in 2019, WN around 17%, AA around 15%), the only airline club and the most popular destination (ATL) exceeds the second most popular (CLT) by over a factor of 3.

   I had time to kill so I wandered around. DL is a ghost town on both sides of security. Looking at departures, they had 2 flights to Atlanta. That’s it. AA has flights to CLT, DFW, MIA, PHL. Even UA which is by far the smallest major airline (classified among the other airlines instead of being listed separately in DOT stats) has multiple flights to ORD, EWR and IAD.

   At the ticket counters, DL had two staff and no customers. AA and WN were actually sorta busy. B6 and UA had more activity than DL (meaning a couple of customers).

   Of course it’s anecdotal but it’s very, very noticeable to even an amateur avgeek like me how little presence DL currently has at an airport for which they have historically been the largest carrier.

   I would like to see monthly market share stats but the DOT only gives rolling 12 month totals (you can select the ending month through September 2020) so I couldn’t really isolate the current state statistically without having significant pre-covid numbers included as well.

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   1. That matches my (also anecdotal) experience. Airport once dominated by NW/DL now empty while AA, UA, and even SY(!) see relatively high activity.

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      1. Speaking of, what’s Sun Country been up to lately?

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      2. have you or anyone else that is touting how full flights are looked at the fares that people are paying esp. on airlines that are operating full flights?

         There are abundant posts on social media of how low fares are that people are buying. Many of them simply do not cover even marginal costs.

         JAX is a business, not leisure market. Same for many Midwest markets where DL is strong.

         Airlines that binge on ultra low fare passengers might actually end up in larger losses.

         A couple things should be clear about DL’s covid era strategy
         1. DL is not adding markets in other carrier strength markets and it isn’t the target to any degree of other carriers in any of its hubs or focus cities.
         2. DL is operating a comprehensive network that is offering similar levels of flights to AA but number of seats comparable to UA considering DL’s seat blocking.
         3. DL is burning the lowest amount of cash as a percentage of current costs.

         btw, a Reuters survey re: the likelihood of booking MAX flights shows that only 3% of passengers are concerned about flying on a MAX. Yet, 24% of passengers said that covid procedures including seat blocking matter, second only to price.

         It is precisely because there is so little business travel, fares are so low that carriers aren’t covering marginal (incremental) costs – as evidenced by cash burn, that DL’s strategy of providing a network that people will pay reasonable fares for might make the most sense right now and lead to the best results.

         The best part of this industry is that enormous amounts of data emerge in time and it will be clear whether each of these carriers’ strategies made sense.

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         1. …yet somehow both UA and AA are getting higher PRASM than DL the last two quarters. I’m skeptical that people are really willing to pay more because of DL’s blocked seats.

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            1. The goal is profitability and not just a revenue metric which may mean lowering costs instead of accepting so much more low fare traffic that you can’t let employees out on leave or retire that could lower costs now and in the long term.

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9. Cranky: any insight on how bookings are looking for HA’s new MCO-HNL?

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   1. Gringo – Sadly, not much I can see on that front yet. I did hear that after the initial announcement, it booked nicely. But when you make a splash like that, it’s not hard to get bookings. It’s the regular, ongoing bookings that are tougher to come by. So, we’ll see how it pans out down the road.

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      1. Cranky, from the way you described that route, it sounds like it will likely become an aspirational route for those who live in Hawaii, with people saving up their FF miles (preferably) or $ (alternatively) to fly the family to Hawaii, similar to how many people who fly the big 3 airlines in the US save up their FF miles with hopes of taking the family to Hawaii or Europe.

         Assuming the MCO route is still around a year or two from now, it will be interesting to see how many seats are filled by those using FF miles. I also imagine that MCO will be one of the top destinations for crew (with regards to schedule/route bidding) and other non-rev pax.

         I’m not knocking the MCO route at all by saying this; to the contrary. If Disney World is as popular of a destination among Hawaii residents as Cranky and the team from Hawaiian Airlines made it sound, it should also get its share of paying passengers and (from a marketing side) serve as a good “prestige” route for pax to aspire to fly on.

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         1. Kilroy – It’s possible this could be a good use of miles for Hawai’i residents. But that’ll be balanced out by the fact that pretty much nobody in Orlando will have HawaiianMiles accounts, so they’ll likely pay cash.
            It’ll be interesting to see how it plays out.

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10. B6 executives have repeatedly said they are trying things to see if some of it works. They have pulled back where it wasn’t working and kept things where it is working. I think people making comments are too focused on some strategic game when the only strategy right now is experimenting where they can.

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