Rohan and Vinay kick off the show discussing the abysmal April for US carriers beginning with Delta's 4-day operational meltdown (2:10) which lead to thousands of canceled flights after its Atlanta hub was throttled by bad weather. Was it REALLY as bad as the media said it was, or was it simply "schadenfreude" for people wanting to chastise the widget for its, "on-time machine" hubris? United is pulling Tokyo - Seoul and shifting 737s from its Guam base to the U.S. mainland (15:50), further decreasing its intra-Asia footprint. Ryanair's, "Always Getting Better" program will now include connecting flights and other customer-friendly perks - and no, this was not an April Fool's joke (28:40). Finally, Norwegian heads West of the Rocky Mountains to launch services to Denver and Seattle. Better get started on that flannel-themed 787, stat.
United's revenue underperformance versus its peers is now front and center, thanks to Scott Kirby's transition to United and greater transparency on levers the carrier is pulling to improve its unit revenues relative to Delta and American. But why is United lagging, despite having hubs in some of the largest and wealthiest U.S. cities (1:10)? Vinay's theory: the carrier is over-exposed to the volatilities of a large international network that could be off-set if the carrier were to re-allocate capacity back to its domestic hubs (3:00). In this network beat episode, Vinay outlines his thesis (which is a complement to his article, "United Should Cut Back International Flying to Fund Domestic Growth," which published in Airways digital on April 5, 2017) and Rohan asks a few clarifying questions. For the revenue management and network planning geeks, this is an episode you will not want to miss!
Vinay and Rohan kick off this week's episode by discussing the electronics ban on flights from certain Middle Eastern countries to the US and UK (2:40). Does this mean that Vinay won't be able to take selfies on his iPad on certain airlines despite getting Global Entry? While on the subject of UK-based carriers, the two discuss the business case for IAG's new Barcelona-based long-haul, low-cost carrier, "LEVEL," (23:32) and what impact will it have alongside the other North Atlantic, "disruptor" LCCs taking the skies by storm in summer 2017? Meanwhile, across the ocean, IAG's JV partner American Airlines had some words for Wall Street Analysts, spearheaded by CEO Doug Parker admonishing that investors are taking "too narrow" of a view on airline RASM performance (36:15). Finally, a star has fallen - somewhat - with Cathay Pacific in the red (45:30). How can Thai be profitable while Cathay is not?