Mike Boyd, the airline consultant we quoted recently criticizing Ontario city leaders for the outsize expectations for the airport, is out with his airline industry predictions for 2014. And just as he did with me, he pulls no punches.
A lot of his arguments have to do with just how much the U.S. airline industry has consolidated in the past eight years. There are now three major global network carriers (United, Delta and American) and one North America-only network airline (Southwest.) The other carriers, he says, are airlines with specific strategies. They are: Alaska, Frontier, Virgin America, Spirit and JetBlue.
Here are a few I found particularly interesting:
1. Smaller and midsize airports like Burbank, Long Beach and Ontario have little control over what airlines serve them. “In a consolidating airline system, a community’s needs are not a factor in airline planning decisions. And, by all means, programs to get “affordable air fares” are about as useful as picketing the local gas station to drop the price of regular,” he writes. As we have written before, Long Beach is in pretty good shape, mainly because Jetblue has made it a focus city. But Ontario and Burbank have seen traffic declines, and that probably won’t reverse in 2014.
2. Airlines are not growing. “With the stabilization and consolidation of the airline industry, the expansion of airline brands is essentially over. Fighting for share has been replaced by “turf control.” Major airlines are interested in building the bottom line, not necessarily (and often to the detriment of) adding new routes. Growth for the sake of more passengers is long gone.”
3. The golden era of frequent flier programs is over. “ When first implemented by major carriers in the early 1980s… the entire purpose was to get consumers to brand-switch, and become brand-focused in their travel choices. Back then , there were lots of brand choices. Not today. So, FF programs are being transformed into systems that measure the money the consumer spends, and in exchange the consumer earns “non-inconveniences” like early boarding and the ability to pre-select a seat in the extra-legroom section.
Want more from Boyd? Read his entire post here.