On Fri, 14 Sep 2007 05:10:30 GMT, Marty Shapiro
wrote:

Even though the majors don't serve these markets directly,
indirectly
they do and derive revenue from them. And that revenue, mainly the
premium first/business class revenue, is what they will no longer get.
(They will continued to get the coach revenue.) The key thing is
that this revenue is from a market they don't even serve or want to
serve.

I don't know what you mean. How does an airline derive revenue for
indirect markets?


No airline flies from say POU to ATL (ie. there is no airline service
at POU), but several airlines fly from LGA to ATL. Anyone going from POU
to ATL needs to drive 90 miles to LGA to then fly to ATL. The airline
derives revenue from that person for the LGA to ATL flight. That's how the
airline derives revenue from a maket (POU) that it doesn't serve.

I see what you mean now, but it's a bit bizarre. By this analysis,
anytime anyone drives from a podunk town to an airport served by a
major they should be counted as indirect revenue. First, there is no
way of measuring this that I can think of. Second, airlines decide
where to fly, what aircraft to use, on what schedule, etc. by what
their marketing studies show. As I said before, they have long since
rejiiggered their routes internationally not because of this but
because they are more profitable due to cutthroat competitions by the
cheapos, becoming more efficient in the process. A number of these
cheapos who can't do that have gotten into a lot of trouble and some
going out of business, killing each other off, so that was the correct
decision. Majors aren't suffering from this. They are profiting with
record loads. Leave the junk to these guys and go after the cream.
It has worked very well.


This is all domestic, as I said, which the majors have been cutting
for some time to reposition internationally.


The lack of runway capacity at major airports has been caused by the
majors eliminating 767's and replacing them with multiple smaller jets,
737's and A320's mainly, to provide increased flight frequency. It wasn't
that long ago that the smaller aircraft did not have transcon capability.
They do now. The airlines would rather run 3 737's at 100% load factor
each rather than 2 767's at 60% load factor. More capacity (seats)on the
2 767 but lower load factor. Better profit margin at 100% load factor.
And, of course, to hell with the passenger if we have to cancel a flight,
as there is no spare capacity to book on another flight.

This is part of the reason, of course, but not all. Other factors are
the government ripping off the trust fund money that was supposed to
go to improving airports, a lousy, inefficient ATC systerm, etc. And,
of course, better loads means better money to a point. But sometimes,
they have lost money on 100% loads because costs were too high. That
why they abandoned a bunch of them.



Well, since they haven't been interested in these marginal markets for
some time, and, at best serve them with regional jets or not at all, I
don't understand what you think they are losing. It's just another
market being served by these others you mentioned. Major airlines
bookings are at all time records.


They haven't had to take an interest in these marginal markets as they
got the business regardless. Again, if you needed to go from East Podunk
to Midwest Podunk you drove to the nearest major carrier airport even if it
took 2+ hours. You then flew on the major to the nearest aiport they
served to Midwest Podunk and then drove to Midwest Podunk. Why would the
airlines care to serve East Podunk or Midwest Podunk if the passenger had
no choice but to drive to an airport they already served? I would do
exactly as the airlines did.

So would I. No one will stay in business long running unprofitably.