Skywest Jets Into Exmouth, Links Coral Coast To Kimberley
Prof. Airport Engineer
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Icarus2001,
Thanks for those kind words. I think that "protecting" routes sits badly with National Competition Policy. I think that "protecting" routes is a bad thing from a free market perspective. I'm by nature a free marketeer. I don't like monopolies. Despite all my philosophical negatives, I think that Nick has engendered the right aviation policy for WA. The market on the THIN ROUTES won't support competition, and opening it up to competition will be destructive and lead to smaller aircraft which necessarily cost more per seat-km and will lead to higher fares. That's why I reckon he is doing well because it takes courage to do it like he has done, rather than do it PC.
One intellectual free marketeer problem is that the WA policy for THIN ROUTES works almost too well. At least WA still has a policy of opening up busy routes to competition. The WA mix of air route policies is [IMHO] clever, advanced, subtle, efficient, and socially aware. Anecdotally, the Canadians were floored by them [in a positive sense] as a solution to some of the thin routes they have.
The current THIN ROUTE policy gives WA reasonable (nay, good) aircraft to all sorts of destinations, and as my calculations show, at a very reasonable fare. The fact that it is Skywest who benefits is neither here nor there. Someone has to do it well and make a deserved profit, and they happen to be it. It might be anyone else after the 2005 tender, and good luck to them too.
I've recently run the airline economics for the Skywest routes for a different project (sorry Skywest, I forgot to tell you about that). The best of their routes in a competitive position can support only a 30 seater and the rest can support a Metro. The fact that Skywest have been able to run big comfortable (almost luxurious) 50 seat aircraft (incidentally did I mention that I love big comfortable aircraft) is a very big bonus. One which advantages rural WA. And one that leads me to endorse the monopolistic air policies on thin routes. I would like the chance to give the same two-bobs worth to the National Competition Policy people! I can remember growing up in aviation when there were only CFS Queenairs, equipped without a toilet, cruising at 7,500', on the Esperance run. Have you tried to hold a pee in for the two hours it took them to fly the route?
I think we've moved a long way forward from that aircraft and I give credit to the WA policy for thin routes (incidentally did I mention that I love big comfortable aircraft).
Thanks for those kind words. I think that "protecting" routes sits badly with National Competition Policy. I think that "protecting" routes is a bad thing from a free market perspective. I'm by nature a free marketeer. I don't like monopolies. Despite all my philosophical negatives, I think that Nick has engendered the right aviation policy for WA. The market on the THIN ROUTES won't support competition, and opening it up to competition will be destructive and lead to smaller aircraft which necessarily cost more per seat-km and will lead to higher fares. That's why I reckon he is doing well because it takes courage to do it like he has done, rather than do it PC.
One intellectual free marketeer problem is that the WA policy for THIN ROUTES works almost too well. At least WA still has a policy of opening up busy routes to competition. The WA mix of air route policies is [IMHO] clever, advanced, subtle, efficient, and socially aware. Anecdotally, the Canadians were floored by them [in a positive sense] as a solution to some of the thin routes they have.
The current THIN ROUTE policy gives WA reasonable (nay, good) aircraft to all sorts of destinations, and as my calculations show, at a very reasonable fare. The fact that it is Skywest who benefits is neither here nor there. Someone has to do it well and make a deserved profit, and they happen to be it. It might be anyone else after the 2005 tender, and good luck to them too.
I've recently run the airline economics for the Skywest routes for a different project (sorry Skywest, I forgot to tell you about that). The best of their routes in a competitive position can support only a 30 seater and the rest can support a Metro. The fact that Skywest have been able to run big comfortable (almost luxurious) 50 seat aircraft (incidentally did I mention that I love big comfortable aircraft) is a very big bonus. One which advantages rural WA. And one that leads me to endorse the monopolistic air policies on thin routes. I would like the chance to give the same two-bobs worth to the National Competition Policy people! I can remember growing up in aviation when there were only CFS Queenairs, equipped without a toilet, cruising at 7,500', on the Esperance run. Have you tried to hold a pee in for the two hours it took them to fly the route?
I think we've moved a long way forward from that aircraft and I give credit to the WA policy for thin routes (incidentally did I mention that I love big comfortable aircraft).
Last edited by OverRun; 3rd Jun 2004 at 21:54.
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Overrun
You have sumed up the problem facing every regional port in Australia.
You either have a single provider with some form of price control from the Government - regulation. Or you have competiton and the customers gets a a short term price war.
Once the battle is finished there will only be one operator left, but they will have lost so much money in the fight that the prices will be higher then the regulated past. This is not an anti competitive stance merely but a reality for routes that are long and thin. The average turbo prop sector in WA is over 400Km's long and has a very small population on the end. For competition to work you need people both ends not one, just look at the Ryanair model. Whilst this might not be a 737 run the principles are the same, you need to have a certain volume of people to get the market flowing.
The other interseting point is the cost per ASK for a metro compared to a Braz and then an F50. With a metro on the route there is no chance of deep discounts unless the plane is full and no YMS is going to allocate a discount seat on a full plane.
So the Governemnt have a difficult job - regulate and be branded un competitive but services will remain or deregulate and watch the fight begin.
It will be interesting to see how this all works out next year.
You have sumed up the problem facing every regional port in Australia.
You either have a single provider with some form of price control from the Government - regulation. Or you have competiton and the customers gets a a short term price war.
Once the battle is finished there will only be one operator left, but they will have lost so much money in the fight that the prices will be higher then the regulated past. This is not an anti competitive stance merely but a reality for routes that are long and thin. The average turbo prop sector in WA is over 400Km's long and has a very small population on the end. For competition to work you need people both ends not one, just look at the Ryanair model. Whilst this might not be a 737 run the principles are the same, you need to have a certain volume of people to get the market flowing.
The other interseting point is the cost per ASK for a metro compared to a Braz and then an F50. With a metro on the route there is no chance of deep discounts unless the plane is full and no YMS is going to allocate a discount seat on a full plane.
So the Governemnt have a difficult job - regulate and be branded un competitive but services will remain or deregulate and watch the fight begin.
It will be interesting to see how this all works out next year.
Thread Starter
i wrote a letter to alannah's office enquiring when the routes are up for review, here was the response, pretty vague...
SKYWEST NETWORK
The Minister for Planning and Infrastructure, Hon Alannah MacTiernan MLA, has asked me to thank you for your correspondence of 13 May 2004 regarding the Skywest network, and to reply on her behalf.
In 2002, in the wake of the collapse of Ansett, the Government provided Skywest with a two-year licence to operate non-jet air services between Perth and a number of key regional centres. The Government recently commissioned an independent review of the intrastate non-jet routes in consultation with the WA aviation industry and regional communities to determine what action should be taken in the longer term.
The Government has accepted the review’s findings that there is insufficient demand to introduce full competition into the non-jet air routes in WA. On that basis, it has been decided to undertake a competitive tender process to select airlines to commence services when Skywest’s current licence expires. It is believed that this represents the best model to ensure that regional communities continue to receive a viable and efficient air service that meets their needs.
Yours sincerely
Signed on 4 June 2004
ROB GILES
CHIEF OF STAFF
SKYWEST NETWORK
The Minister for Planning and Infrastructure, Hon Alannah MacTiernan MLA, has asked me to thank you for your correspondence of 13 May 2004 regarding the Skywest network, and to reply on her behalf.
In 2002, in the wake of the collapse of Ansett, the Government provided Skywest with a two-year licence to operate non-jet air services between Perth and a number of key regional centres. The Government recently commissioned an independent review of the intrastate non-jet routes in consultation with the WA aviation industry and regional communities to determine what action should be taken in the longer term.
The Government has accepted the review’s findings that there is insufficient demand to introduce full competition into the non-jet air routes in WA. On that basis, it has been decided to undertake a competitive tender process to select airlines to commence services when Skywest’s current licence expires. It is believed that this represents the best model to ensure that regional communities continue to receive a viable and efficient air service that meets their needs.
Yours sincerely
Signed on 4 June 2004
ROB GILES
CHIEF OF STAFF
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Really got the finger on the pulse, have'nt you Alannah.
Let me start this with " I have nothing against Skywest ! "
However, what constitutes a " thin route " ? ( is it Kate Moss
)
Airlink operated to KA and PD for years, with crap load factors, that bad they actually ended up pulling out of PD.
Now, with the demise of Ansett, they are getting good loads on both those ports ( along with QF on KA ).
My point however is : another operator eg. Skywest on those routes, will necessitate either a) a reduction of flights or b) excepting smaller loads for the existing operator ( in this case QF )
So what is the difference between that and the Geraldton/Esperance situation ?? I am led to believe that Skywest have quite a few flights to both of those ports every day, and enjoy little, if no, competition.
So it is absolute crap that those places won't support 2 operators, it would mean that one of those operators ( Skywest ) would be making less money, if thats not protection of an airline , what is ?
Apart from BRM and KG, and maybe KA, there are very few ( if any ) routes in WA that will support 2 jet operators ( profitably )
So where is the protection for the operator on those other routes ??
Let me start this with " I have nothing against Skywest ! "
However, what constitutes a " thin route " ? ( is it Kate Moss
)Airlink operated to KA and PD for years, with crap load factors, that bad they actually ended up pulling out of PD.
Now, with the demise of Ansett, they are getting good loads on both those ports ( along with QF on KA ).
My point however is : another operator eg. Skywest on those routes, will necessitate either a) a reduction of flights or b) excepting smaller loads for the existing operator ( in this case QF )
So what is the difference between that and the Geraldton/Esperance situation ?? I am led to believe that Skywest have quite a few flights to both of those ports every day, and enjoy little, if no, competition.
So it is absolute crap that those places won't support 2 operators, it would mean that one of those operators ( Skywest ) would be making less money, if thats not protection of an airline , what is ?
Apart from BRM and KG, and maybe KA, there are very few ( if any ) routes in WA that will support 2 jet operators ( profitably )
So where is the protection for the operator on those other routes ??
Thread Starter
you will actually find cunninlinguist that the geraldton route actually has a reasonable degree of competition.
skippers now schedule 7 return services a week with at least one return service each day, including services that continue through to Shark Bay.
media release below shows recent changes to geraldton air services...
The Hon. Alannah MacTiernan MLA
Minister for Planning and Infrastructure
Statement Released: 27-Apr-2004
Portfolio: Planning and Infrastructure
Changes to air services for Geraldton
27/4/04
Planning and Infrastructure Minister Alannah MacTiernan today announced changes to air services to Geraldton and other ports effective May 3, 2004.
Skippers Aviation will be permitted two additional Perth-Geraldton-Perth services on Wednesday mornings and afternoons and a revised service from Perth to Shark Bay via Geraldton and return on Saturdays.
Skywest Airlines will reinstate a through-service from Carnarvon to Perth via Geraldton on Friday afternoons.
"The State Government has been closely watching the competitive situation with air services to Geraldton, mindful of the importance that both airlines can survive in the marketplace," Ms MacTiernan said.
"The community is always enthusiastic about an increase in services.
"However, the State Government has to be mindful that service levels are sustainable. It has considered the impact on the viability of other services in the Skywest network, particularly those that link with Geraldton.
"Regional air services are important throughout Western Australia and although the regional airline industry in Australia continues to battle in difficult times, this Government has taken a measured approach to ensure service levels are commercially realistic."
Geraldton services will be kept under continual review including the possibility of future jet services between Perth-Geraldton and other ports further north in the Skywest network.
Security aspects need to be considered. The Government will do all it can to meet Federal security requirements and to minimise the associated costs on air travellers.
Minister's office: 9213 6400
skippers now schedule 7 return services a week with at least one return service each day, including services that continue through to Shark Bay.
media release below shows recent changes to geraldton air services...
The Hon. Alannah MacTiernan MLA
Minister for Planning and Infrastructure
Statement Released: 27-Apr-2004
Portfolio: Planning and Infrastructure
Changes to air services for Geraldton
27/4/04
Planning and Infrastructure Minister Alannah MacTiernan today announced changes to air services to Geraldton and other ports effective May 3, 2004.
Skippers Aviation will be permitted two additional Perth-Geraldton-Perth services on Wednesday mornings and afternoons and a revised service from Perth to Shark Bay via Geraldton and return on Saturdays.
Skywest Airlines will reinstate a through-service from Carnarvon to Perth via Geraldton on Friday afternoons.
"The State Government has been closely watching the competitive situation with air services to Geraldton, mindful of the importance that both airlines can survive in the marketplace," Ms MacTiernan said.
"The community is always enthusiastic about an increase in services.
"However, the State Government has to be mindful that service levels are sustainable. It has considered the impact on the viability of other services in the Skywest network, particularly those that link with Geraldton.
"Regional air services are important throughout Western Australia and although the regional airline industry in Australia continues to battle in difficult times, this Government has taken a measured approach to ensure service levels are commercially realistic."
Geraldton services will be kept under continual review including the possibility of future jet services between Perth-Geraldton and other ports further north in the Skywest network.
Security aspects need to be considered. The Government will do all it can to meet Federal security requirements and to minimise the associated costs on air travellers.
Minister's office: 9213 6400
Thread Starter
and this....
Media Release - 9th June 2003
SKIPPERS OFFERS $49 ONLINE
SPECIAL TO THE CORAL COAST
Skippers has today announced the release of 1000 discount seats across its range of destinations within Western Australia’s Coral Coast. Fares start from an incredible $49 oneway to Geraldton.
This fantastic offer commences on Wednesday 9th June 2004 and applies to online bookings only, for travel up to and including 31st December 2004.
Discount seats will be available on flights to and from Geraldton, Kalbarri & Monkey Mia on a “first come first served” basis and are subject to special terms and conditions.
Skippers Chief Executive Officer, Rob Swann, said that “The introduction of these fares to the Coral Coast service is expected to draw many first time visitors keen to learn more about this world heritage region.”
“The Coral Coast provides an ideal getaway destination for first time visitors to experience the fantastic attractions of Kalbarri, Geraldton or Monkey Mia. These fares offer a cost effective alternative to driving and are expected to provide a welcome boost to tourist numbers visiting this remarkable region.”
Media Release - 9th June 2003
SKIPPERS OFFERS $49 ONLINE
SPECIAL TO THE CORAL COAST
Skippers has today announced the release of 1000 discount seats across its range of destinations within Western Australia’s Coral Coast. Fares start from an incredible $49 oneway to Geraldton.
This fantastic offer commences on Wednesday 9th June 2004 and applies to online bookings only, for travel up to and including 31st December 2004.
Discount seats will be available on flights to and from Geraldton, Kalbarri & Monkey Mia on a “first come first served” basis and are subject to special terms and conditions.
Skippers Chief Executive Officer, Rob Swann, said that “The introduction of these fares to the Coral Coast service is expected to draw many first time visitors keen to learn more about this world heritage region.”
“The Coral Coast provides an ideal getaway destination for first time visitors to experience the fantastic attractions of Kalbarri, Geraldton or Monkey Mia. These fares offer a cost effective alternative to driving and are expected to provide a welcome boost to tourist numbers visiting this remarkable region.”
