Frontier trims schedule

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http://biz.yahoo.com/ap/040909/frontier_airlines_2.html

DENVER (AP) -- Frontier Airlines Inc. has pared its flight schedule by about 13 percent and made other adjustments to trim costs as rising fuel prices continue to batter its bottom line.

The low-cost carrier expects additional savings when it completes its shift to an all-Airbus fleet and implements a new reservations system next year, Frontier CEO Jeff Potter said Thursday at the carrier's annual shareholders meeting.

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Although many will see the losses at the LCCs as a sign things are turning in favor of the legacies, I'm not so sure. I think it shows how brutal the fuel price issue and the winter travel drop are going to be. Probably most of the LCCs will survive the winter just fine. By next spring the shape of the future industry may be starting to take a little more focus.

[tonyw]

I think what we are seeing is that just being an LCC isn't enough. Wall Street loves to jump on the bandwagon -- think dot com bubble, biotech bubble, etc. Well, they jumped on the LCC bandwagon, but just like the other two situations I mentioned, they didn't bother to think, you know, some LCCs will do well, some will fail and some will muddle along. Nope, they just lumped them all together, and fell all over themselves to hype them.

So what else is new? [img]/ubbthreads/images/graemlins/rolleyes.gif[/img]

[FalconCapt]

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Although many will see the losses at the LCCs as a sign things are turning in favor of the legacies, I'm not so sure. I think it shows how brutal the fuel price issue and the winter travel drop are going to be. Probably most of the LCCs will survive the winter just fine. By next spring the shape of the future industry may be starting to take a little more focus.

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I think what it shows is that if the LCC's are strugling, then the Legacy Carriers are in REALLY bad shape... The Legacy Carriers have a worse cost structure than the LCC's, anyhting that hurts the LCC's will hurt the Legacy's even more...

[flyover]

[ QUOTE ]
I think what we are seeing is that just being an LCC isn't enough. Wall Street loves to jump on the bandwagon -- think dot com bubble, biotech bubble, etc. Well, they jumped on the LCC bandwagon, but just like the other two situations I mentioned, they didn't bother to think, you know, some LCCs will do well, some will fail and some will muddle along. Nope, they just lumped them all together, and fell all over themselves to hype them.

So what else is new? [img]/ubbthreads/images/graemlins/rolleyes.gif[/img]

[/ QUOTE ]

Agree, no respect for Wall Street "analysts". The interesting thing about JetBlue was it's stock runup was counter to many analysts' warnings and seemed to be driven by customers who were so excited by the product they had to own the stock.

I think this is exactly like the story of being chased by the bear. You don't have to outrun the bear you just have to beat the other guy. The industry is heading toward some stablility in costs, capacity, and prices/demand. The question is who will make it there and who will get eaten by the bear. The legacies have a chance to gain some speed by reorganizing, but they will have a major problem with their deflated and demoralized workforce. That, more than anything else, may be the biggest advantage the LCCs have. The biggest wildcard is how much capacity gets permanently parked in the desert.