http://iagblog.blogspot.com/
In particular April 28th blog with comments from fan favorite Boyd Group:
Here's another strategic trend forecast from The Boyd Group, one that the aviation cognoscenti will sneer at today, and next year will be preaching like an evangelist who just discovered a gospel tent: The airlines best postured to weather this oil price storm are legacy carriers. The ones that will be hurt worst and first will be low-cost carriers. Some key points:-
- Legacies have reduced their operating costs, so they aren't wildly at variance with LCCs any longer. -
- Higher fuel costs will lead to higher fares. Higher fares will hit discretionary, price-driven passenger segments first. Passengers who in the past were created by low fares to Orlando will think twice with higher ticket prices and $3-per-gallon gas for the SUV.-
- Legacies will continue to have access to the strong growth traffic at places such as Shreveport, Taipei, Montgomery, Tupelo, and Kaoshiung. (Tupelo? Yup. Traffic's up almost double in two years. Maybe it's the consultant they hired.) LCCs don't have the fleets or the route systems to access these flows. -
- Most importantly, legacies are not as vulnerable to traffic down-turns as are LCCs. That's because several legacies have significant fleets they can quickly park, and have limited aircraft on order, unlike most LCCs. In fact, the new-airliner orderbook may well be the Achilles Heel of the LCC segment in the next 18 months.
No comments:
Post a Comment