I'm sorry to hear about Skybus but they launched at the wrong end of the financial cycle. Even though the Sub-Prime problem had not emerged at launch (May 2007), it was clear that finances were down.
saccade
PAXboy,
LCC's don't have low fares because they just happen to be an LCC. They sell their seats for the optimum price in order to maximize profit. FR is able to operate very thin routes because they can be profitable with relatively low yields. This might change with higher operating costs and hence: higher fares = capacity reduction.
Yes. I know all that and did not say otherwise. ALL airlines are going to suffer in the next two years. The ones in the US and Europe probably rather more than elsewhere.
Mercenerary Pilot
Original Quote from PAXboy:
Oh yes they will!!!!!! Everyone wants to pay less
Not everyone. I, like many other people I know, WILL pay extra for good customer service and some individual's/companies are prepared to pay a lot of money for better service hence the massive growth in the corporate aviation sector in Europe. Will this continue with the possible economic downturn? We shall see.
I do not think that there will be sufficient numbers to keep carriers going. The corporates will shift down to Economy for short and medium haul and expect the Premium Economy to be popular for long haul. The LCCs will pick up more from corporates but then they will also lose more off the bottom end of their clients.
If a global bank lays off, say, 5,000 staff then those that used to travel for work are not even going to be in Economy!
Many more mergers and takeovers will happen. How are Delta and North West getting along? It looks as if they got talking just in time, although rationalisation will still be required.