Originally Posted by
GELOFAB
Cyrano:
a) With all due respect. I don 't care if I am unrealistic. I do know what would happen if everybody adopts the "there is nothing that can be done" attitude or the "perfectly rational timidity" attitude. It will happen that business is gone, as it has happened in other airports. To this we only have two options .Either we can go to the pub for a pint and to lick our wounds with perfectly rational timidity or we can try to think in alternatives. Even unrealistic alternatives are valid to me even if they only serve to the purpose of setting up the limits
b)It is not my job to raise money and start up a company business. However, is the job, and the duty, of the guys and gals in the SAA to loook for other options beyond FR.
c) what SAA could try, in my opinion, is not only what you mention about charges, that as well, but a commitment to say to other FR direct competitors: Here is the deal: not only am I offering you x amount of charge per passenger but I am telling you if you come and do business with me, SAA, I will charge Ryanair double amount in fees per passenger than the amount I am charging you for x amount of time. This is only an example of what could be done. I honestly do not see what is the problem in picking up the phone and making this kind of unrealistic offers to FR competitors and their shareholders.
And the point behind this idea is, precise, what you have mentioned about FR competitors.They have failed to enter the market because FR fought better.Well, is time to kick FR out of the market and give entry to new players and new rules. What you say about FR and Aer Arann in Cork is precisely why this has to be fought back. If SAA has an oportunity to survive is by fighting back FR, not by melting down with "perfectly rational timidity". What is sure, because we have seen it throughout Europe, is that if you play FR game you are going to suffer the consequences, one way or the other. Besides, what is FR going to retaliate back with? withdrawing their planes?
Whas is there left for Shannon airport to lose?
it is definitely easier to tell to each other there is nothing can be done so let's go to the pub for a pint or two and to watch soccer.That I can do too.
Gelofab:
My last comment on this subject. I do airline route development for a living but apparently don't understand it as well as you.
You ask (my emphasis above) why SAA don't go out and offer deals to other carriers along the lines of "we'll give you a discount, and we'll charge Ryanair more."
I have news for you:
they do. I see the SNN Marketing Manager at every route development conference I attend and I'm sure at others I don't attend, and I'm sure he is talking to airlines in between the conferences. In the past, SNN has offered a discount scheme to the first airline entering a given route (subsequent airlines on the route don't get the discount). I have no doubt whatsoever that if an airline wanted to serve a new route from SNN they'd be able to negotiate this kind of deal.
When I refer to "rational timidity", I am not talking about SNN, but about airlines, who are by and large neither as financially strong nor as aggressive as Ryanair, and who are trying to find ways of developing their network without just becoming FR's next victim.
What I seem to be having difficulty communicating is that with the threat of Ryanair competition,
it doesn't matter if SNN promises you, the airline, a discount landing-fee deal. Yes, it will reduce your costs (or increase your revenue, depending on how you show it on the ticket) by say EUR5 per passenger. Great - this certainly helps your route breakeven
in the absence of competition. But then Ryanair blasts in and suddenly your revenue is halved, and their goal is not to make money on the route, but just to get rid of you. No landing-fee discount deal will immunise you against that.
But what do I know? My Board and shareholders have this unreasonable expectation that we will not launch routes without at least a reasonable hope of profitability. Nothing to do with going to the pub and watching soccer.
Merry Christmas.
C.