It’s me again. Sorry It’s been a while since you’ve heard from me, but that wasn’t by choice. It certainly wasn’t for a lack of things on which to comment, that’s for sure.
One recent trend in the airline business that, although is a logical result of too much capacity and $100/barrel oil, bugs me is ancillary revenue. There was even an “Ancillary Revenue Airline Conference” held recently. Heck, it must be here to stay if it is an acronym.
Call me a purist, but I think it is a sad day in Whoville if airlines can’t make enough money from selling airline tickets to make a profit, so they have to resort to selling display ads on their tray tables and charging most customer for checking more than one bag. To be sure, the current conditions have created some strange bedfellows, including an alliance between Allegiant Air and The Blue Man Group, which still baffles me. However, people a lot smarter than I have determined that “it is good”.
It may be helpful in the short term, but if an airline can’t make enough money selling its services to support itself taking people to and from where they want to go, I don’t think you can sell enough sandwiches, check enough second bags, or sell enough hotel rooms or show tickets to have any long term success. You might make it in the short term, perhaps make a few bucks in an IPO and get out before the house of cards falls in; but eventually the business plan needs to be sound.
Well that’s all from Godzilla this evening. If, due to my absence, you have forgotten who I am you can check out Holly’s introduction of me here. I would certainly be happy to read your comments; posted here or sent directly to Godzillaspeaks@gmail.com.
Category Archives: Godzilla Speaks
All in the Family
I downloaded the DOT application for Family Airlines yesterday and although it is a 355 page document, beyond the pro forma stuff required for the application and the numerous resumes, I don’t see the case being made as to why the world (or at least Las Vegas) would be better off with Family Airlines. The concept isn’t new, the strategy isn’t real clear, and there doesn’t seem to be a compelling reason to locate in Las Vegas except that some of the principals live there.
One of the confusing things about the application was that the facts listed on their website don’t always jive with what is listed in the DOT application. In the first paragraph of the Company Information page they list the seating configuration of their 747-400 aircraft as 539 in Coach and 42 in their version of business class (called Office Class) in the upper deck. In the DOT application the configuration is listed as 482 in Coach and 42 in the upper deck business class. The web site also lists the pitch in Coach as 31-32 inches. Not being an expert in the 747-400 I will defer to those who are, but I’d be interested to learn if it is possible for a 31″ pitch with 539 seats.
Another interesting feature is that Family Airlines forecasts that 50% of its revenue will come from things like selling food, entertainment, and internet access onboard. They will also take every opportunity to sell consumer ads on, in, and around their airplanes. The CEO Barry Michaels is quoted on the web site “I’m a believer that everything you see or touch should be paid for by advertisers.”
Family Airlines says it will start with two airplanes flying JFK-LAX-MIA (reminiscent of another and defunct 747 operator – Tower Air) with fares ranging from $19 to $69. Apparently the inflight personnel will also be entertainers, at least according to their promotional information.
Where do I start.
First, the airplane. Four engines. Four HUNGRY engines. Second, the “hub”. Remember National Airlines? They flew 2 engine B757’s and they got killed on the short legs from LAS (LAS-PHX, LAS-LAX, etc.), and that was at $50/barrel oil. I have no idea of the operating efficiencies of a B747-400 but I would guess that on anything less than 1,000 miles it is pretty ugly.
Third – multiple profit centers. At $19 per passenger on the (proposed) LAS-LAX leg you better be selling dinner at $50 a plate and rowing a banner begind the airplane if you want to make a profit on that sector.
There is more, but it’s like clubbing a baby seal. This is just a bad idea and nobody I have talked to thinks it is a good idea. I understand the excitement of building a new airline and trying to do something different. But this ain’t it. There is nothing here that hasn’t already failed before.
You need more than low fares to be successful in this business.
My First Blog
Actually it isn’t my first blog, but I don’t think it is official blogging if nobody reads what you write, which I am pretty sure is what happened to my first effort at this some time ago. It’s kind of like that tree falling in the forest with nobody around to hear it; if nobody reads your blog, did you really blog at all?
Blog. The word itself is pretty interesting; it can be both a noun and verb, and perhaps even an adjective (e.g. ‘That guy is a real bloghole’). Perhaps it’s just me (it usually is), but it sounds like something your dog might do in the back of your car on the way to the vet. “Nikko blogged all over the back seat and I had to clean it up.” Apparently anyone who can type can be a blogger. Kinda like karaoke; give a drunk a microphone, some background music, an audience, and viola (a stringed instrument similar to the violin) – a singer is born.
However, as those who watch American Idol can confirm, there are good singers and bad singers. And as those who read blogs can confirm, there are good bloggers and bad bloggers. Holly has done quite a job of building a great reputation and providing good content. Being a novice at this I will endeavor to be a good blogger by sticking to two simple rules:
1) Only talk about stuff I know something about.
2) Provide the reader with a good ROI for the time spent reading the blog.
I will also eventually figure out how to use this blogging software as time goes on and be able to put in pictures and links and stuff. For now I am just trying to make sure the paragraphs line up and I can get spell check to run.
I encourage comments and emails from people who agree with my opinions, and you can send them to Godzillaspeaks@gmail.com. Just kidding. People who disagree can also send email, I just won’t read them.
I’ll come back at this soon when I have something perhaps more substantive to offer; perhaps after I have a chance to dig into the JetBlue decision to make like a legacy carrier and [gasp] begin offering refundable fares.