SOUTHWEST: Considers 2nd Type of Aircraft

Associated Press

DALLAS - Southwest Airlines, which owes part of its success to its use of a
single type of jet, the Boeing 737, is considering adding a new plane to its
fleet for the first time in its 33-year history.

Southwest has considered adding 50- and 70-seat regional jets to its fleet
but always balked because they couldn't carry enough customers to bring the
cost per passenger low enough.

That might change with the 100-seat Embraer 190, says chief executive James
F. Parker. He adds, however, that a decision to change the fleet is still
far in the future.

"We are very happy operating a single aircraft type with the 737," Parker
said, but the larger regional jet is "a new technological feature or aspect
of our industry that I think we need to take a look at."

Parker added that "We are a long way from making a decision, and I can
assure you we would make a decision to walk away from the advantages we have
of operating a single aircraft type only with a great deal of reluctance."

Parker made the comments Wednesday to analysts in New York. In trading
Thursday on the New York Stock Exchange, Southwest shares rose 2 cents to
$18.84.

A change in the makeup of Southwest's fleet would go to the core of the
airline's business model. Dallas-based Southwest, the only major U.S.
carrier to remain profitable through the industry slump since 2001, enjoys
lower costs per passenger than rivals such as American, United, Delta and
Continental.

Part of that cost advantage stems from Southwest's exclusive use of the
Boeing 737 in its 385-plane fleet. Southwest doesn't need to stock parts for
other jets, and mechanics need be schooled only in the workings of one
aircraft.

The workers' familiarity with the Boeing 737 helps Southwest turn around
incoming planes and get started on the next flight in an average of 25
minutes, the best record among major U.S. carriers.

The 737 is ideal for Southwest's heavy schedule of short and medium trips -
80 percent of its flights are 90 minutes or shorter. The latest version of
the plane, the 737-700, has more power and gets better mileage and is used
on longer flights, including transcontinental routes.

JetBlue Airways has already ordered 100 Embraer 190s and has options for 100
more from the Brazilian manufacturer.

Betsy Snyder, an analyst with Standard & Poor's, said JetBlue's costs for
operating the Embraer is similar to its Airbus A320s, indicating that the
Embraer could be a "very plausible" addition to Southwest's fleet.

"They're not going to do anything to jeopardize their cost structure or
their balance sheet or their earnings," she said.

While it mulls the possibility of buying Embraer jets, Southwest will
continue to buy planes from Chicago-based Boeing. It expects to take
delivery of four new 737s in the current quarter and 47 next year.

Those new planes will let Southwest add service in Philadelphia next May,
increase capacity by 7 percent next year and replace 24 planes scheduled for
retirement by early 2005.

Many of those retiring planes are older Boeing 727-200s, and Parker had a
quick answer when an analyst asked whether the airline could bring them back
if travel increased.

When those 737-200s are retired, Parker replied, "the most likely way they
will be brought back will be as containers for the Miller Lite cans on our
aircraft."

http://www.sunherald.com/mld/sunhera...ss/7253409.htm

None wrote:
Southwest has considered adding 50- and 70-seat regional jets to its fleet
but always balked because they couldn't carry enough customers to bring the
cost per passenger low enough.

Which is most interesting reality that the larger airlines haven't quite
grasped yet. The only reason regional jets have caught on is because the big
airlines were able to pin off a low cost "regional airlines" that was allowed
to fly those, and even though the operating cost per pax is higher, they were
able to hire el-cheapo pilots instead of their very expensive mainline pilots.


"We are very happy operating a single aircraft type with the 737," Parker
said, but the larger regional jet is "a new technological feature or aspect
of our industry that I think we need to take a look at."

Bull ****. The real reason is that with a single plane type, Southwest has
pretty well reached its limit on viable destinations. They will need other
plane types to reach new destinations. And this is the exact same argument
used by Jetblue when it ordered its jungle jets.

The workers' familiarity with the Boeing 737 helps Southwest turn around
incoming planes and get started on the next flight in an average of 25
minutes, the best record among major U.S. carriers.

I don't buy that argument at all. Plane turn around is a question of schedule,
planning and staff flexibility. Since both the 737 and jungle jets have loose
baggage compartments, it doesn't really make much of a difference. If some of
its jets were containerized and some were loose luggage, then it would make a difference.

The big advantage of having single fleet is that the pilot pay structure,
scheduling and eniority issues make it a much more efficient system. When you
fire the pilot with least seniority, you don't need to retrain all pilots with
more seniority who get displaced ontothe next lower plane type.

In terms of maintenance, I am not so sure that Southwest really has that big
of an edge. Are the 737 of various flavours really so compatible with each
other ? I find it hard to believe that a 737-200 would be the same as a
737-700 in terms of maintenance and spare parts.

Betsy Snyder, an analyst with Standard & Poor's, said JetBlue's costs for
operating the Embraer is similar to its Airbus A320s, indicating that the
Embraer could be a "very plausible" addition to Southwest's fleet.

The Jetblue president, shortly after announcing that order was interviewed on
the USA PBS program "Charlie Rose". He was very specific in that the smaller
jets are in no way as cost effective as their A320s, but that they would still
be profitable and allow JetBlue to continue to grow.

Now, for jetblue, there is a bigger difference between the A320 and jungle jet
than there would be for Southwest and the same jungle jet since A320s are bigger.

But for Southwest, they may be forced into it since if they don't start to
open up the thinner routes to smaller towns, Jetblue and others will and
Southwest may no longer be seen as the leading airline because it will have
stopped growing.

The big question will be how both these airlines treat Jungle jet pilots
versus the bigger plane pilots. They may end up over time with problems
similar to the bigger airlines (but perhaps not to the same extent) in terms
of pilot seniority, and who gets bumped first when layoffs are necessary.

On Sat, 15 Nov 2003 17:56:59 -0500, Furry Raccoon
wrote:
Cut to save space...

The big question will be how both these airlines treat Jungle jet pilots
versus the bigger plane pilots. They may end up over time with problems
similar to the bigger airlines (but perhaps not to the same extent) in terms
of pilot seniority, and who gets bumped first when layoffs are necessary.
"Jungle Jets"...??? Thanks,
H
Retired Teacher, Terrible Mechanic, Worse Plumber!
LPFM Page: http://home.att.net/~optcamel/fmradio.htm