This reminds me of a vendor of networking products that we could call L. They ended up with a portfolio of machines that were almost perfect for handling all the dial-up traffic an ISP could want, with good management and reference designs and consultants ready to show you how to start or grow your ISP with many many points-of-presence.
And they sold their expensive equipment and made lots of money, only it turned out that many ISPs couldn't really afford all this upfront, and it made sense for L to operate a financing company itself and finance the purchases of the expensive hardware. There was a huge and growing demand, and if an ISP defaulted, well, L could take back the equipment and refurb it and sell it to the next company that came along.
Only when the market actually saturated, there was L holding all these valuable financing agreements backed mostly by the hardware that nobody new wanted to buy.
I am curious why you used the mysterious L in your comment instead of referring to Lucent by name? None of what you wrote was libelous. For people not around at the time it will not be obvious who you are referring to. As a result only the "cool older kids" know who L is and it makes it hard for newcomers to learn about the history of the industry. Personally I do not think hacker news comments should be written in such a way as to reinforce boundaries and segregate "people in the know" from the unwashed masses.
Because it doesn't really matter which company L was: the point applies across markets. When you finance all of your sales with only the products you make as collateral, market failures come easily.
Anyone else want to kickstart an airline that operates with as few humans as possible? You aren't allowed to check luggage at all...(all the underbelly goes to companies like fedex and ups) just attacking it as an engineering problem?
I assume you'd be allowed a small bag of carry on (with a laptop/book/whatever in it), just not a 'maximum allowable size suitcase with everything you need', specifically to avoid paying the checked baggage fee.
The people have spoken, and they like cheap as shit tickets in cattle class with no extras. And it's easy to see why - I'd pay maybe 10% more for an experience you describe, but it wouldn't be 10%, it'd be at least 200% more, probably significantly higher than that.
Maybe when I'm older and a 12 hour flight in economy becomes really unpleasant instead of just an inconvenience.
I would assume this would cater to individuals with some amount of discretionary spending (like those who don't mind using uber, instead of a significantly cheaper public transit option), but aren't quite ready to pay for 1st class.
Doing an even more bareboned airline is just a race to the bottom. Eventually you'll end up with like MAC flights in a C130 sitting in a jumpseat.
You mean something like Eos, Silverjet, Maxjet and no doubt a half dozen other bankrupt companies? It's not like no one has had that idea before. It' been tried, again and again, and no one has made it work. Now obviously that's not saying you can't make it work, but so far the track record of everybody who has tried isn't that great.
I actually sort of like the membership idea, that makes the rest really easy and invalidates the need for a "rewards program" Just always provide good service.
I flew economy from London to Mumbai with as much booze as I could handle, both directions. There was some sort of ban on serving alcohol in Indian airspace, but outside of that they were happy to keep giving me tiger beer until I fell asleep.
It's because they don't understand basic finance concepts. If they knew what time value of money and net present value meant, they'd realize that something that paid for itself in ten years is a bad investment.
Everyone in every discipline should be required to take Finance 101.
Something that pays for itself in ten years is a bad investment and how humanity progresses. Long term investment is essential and basic science requires it.
The problem is that you can't actually fire anyone on board the plane. Those flight attendants aren't there to serve your drinks. They're there to guide/assist you "in the unlikely event of an emergency."
The pesky regulations say they need x attendants per passenger.
Ryanair already have this down to a T. You don't actually interact with any ryanair staff from the time you book your flight until you're passing through the gate. At that point you meet the cabincrew/stewards for your flight, two at the door who check your boarding pass and glance casually at your passport, and you then walk across the runway to board the plane in no particular order. Everything is an extra,you're bombarded with ads for the duration of the flight (particularly annoying on a 45minute flight where they start at takeoff and keep going until you land).
You also print your own boarding pass, and are normally located as far as humanly possible from the airport terminal, in an airport nowhere near the location advertised (London Stansted, Barcelona Reus, Paris Beauvais).
But I can fly to London return for 30 euro pretty much any time of the year in return for that.
It's unlikely ever to happen, but I wish someone would start an airline that only requires pre-2001 levels of security screening[0]. I'd be interested in seeing how having some competition on security policies would affect the larger market. Would people value the sense of security that the theatre gives them, or would they prefer the less invasive measures?
Unfortunately, AFAIK, every airport in the country is required either to use TSA screening or to use private security companies whose policies are set by the TSA[1], so this is unlikely ever to happen.
[0] With the exception of ensuring that cockpit doors are always closed and locked during flight - this was the one absolutely critical security improvement that came out of 9/11.
[1] I believe SFO is one airport that uses a private company.
The TSA screens operations running under 14 CFR 121; there's not much you can do about that other than fly under 14 CFR 135, which is for "Commuter and On-Demand Operations." (This is how companies like Surf Air get away with not having to have TSA screening.
The planes practically (can) fly themselves these days now anyway. Remove the ticket people, checking bags, food/drinks on the plane, and build a nice, efficient website for booking... Then structure your routes on flexible demand. Almost like crowdbuying tickets... There are probably a low number of people (outside business travel) that need to be somewhere at an exact time. Operate the ticket buying process like Massdrop. Let the collective decide when a plane takes off.
There's a lot of tweaks that could change the airline industry, but certainly no easy task.
With the exorbitant costs of maintenance and fuel, plus the prorated cost of the plane itself, I'm wondering how much impact those small-ish changes could have.
Warren Buffett: “If a capitalist had been present at Kitty Hawk back in the early 1900s, he should have shot Orville Wright. He would have saved his progeny money. But seriously, the airline business has been extraordinary. It has eaten up capital over the past century like almost no other business because people seem to keep coming back to it and putting fresh money in. You’ve got huge fixed costs, you’ve got strong labor unions and you’ve got commodity pricing. That is not a great recipe for success.”
I submitted this story. Honestly I submitted to hn because after stumbling on the site I thought I had seen it on hn before, so I figured submitting was the fastest way to find discussion. Is there a reason that the submission didn't get flagged from the get go?
The duplicate detector is deliberately left weak so that good stories get more than one crack at the bat. But if a story has had a significant discussion within the last year, then we bury it as a dupe. The best thing to do is check HN Search to see if this is the case.
Before anyone goes out and does this research supply of planes. Locked up for many years to come from Boeing and Airbus. CEO of American Airlines outlines this in details and suggests fairs will go up and stay up as a result. Not sure if he's right but he seems pretty sure of it.
Allegiant is a great example. They fly slightly less fuel efficient MD-80s which can be bought at bargain prices from the legacy carriers (MD-80's are those narrow body jets with the engines in the back and the 3-2 seating arrangement). They make it work by flying nonstop flights from smaller airports (without competing carriers on those routes), with low frequency. The low frequency also gives them longer until they have to do a heavy maintenance check -- which, for an older MD-80, usually costs more than the plane is worth. http://www.fastcompany.com/1325762/heard-allegiant-air-why-i... .
> The low frequency also gives them longer until they have to do a heavy maintenance check -- which, for an older MD-80, usually costs more than the plane is worth.
The point I was making is that many of the planes in the boneyards are in working condition (assuming you gas them up and do some other trivial un-mothballing work).
It's not like a car, where it can be driven until the wheels fall off. Planes are flown until they need an expensive scheduled maintenance check, even if they seem to work just fine.
(To be absolutely clear: I don't think this is a bad thing. Maintenance checks are good. Falling out of the sky is bad.)
I know absolutely zero about this industry but I'm not sure this fits the CC model. What's the plan to move up market? I just think there isn't any easy money, especially not in airlines. You gotta just be awesome at everything...
This is almost completely wrong, and more about AA wanting to be able to raise prices.
Boing and Airbus are the only viable suppliers of long-range commercial aircraft, and if you order a 787 or A380 you will need to wait[1].
But it's not "locked up" so much as it takes a fair while to build, and they do have order books. But they are desperate to sell as many as they can (stories of orders being cancelled aren't uncommon).
In the short and medium range market there are a number of other suppliers. Embraer and Bombardier both have planes that sell well. For the more adventurous there are the Irkut MS-21 and Sukhoi Superjet 100 (both pretty modern, but I think only in service with Aeroflot)
As noted elsewhere, there is a large market in second hand aircraft.
[1] There is actually http://en.wikipedia.org/wiki/Ilyushin_Il-96, but I think that has only been sold to Aeroflot and other Russian airlines. Edit: turns out the passenger version of this is now out of production.
Air travel is a commodity which means razer thin margins and fight for shaving off every last cent. In this type of markets, usually way to succeed is provide upscale product but with only slightly higher margins. In other words, instead of fighting for margins at the bottom, you fight bit above. In airlines case this strategy would translate in to providing all business class plane but with only 15% extra prices, for example. Lot of customers who are extremely unhappy about nickling and diming would flock to this model.
The problem is that first class takes up much more than 15% more space per person than coach. You'll notice there are three chairs per side per row in a standard 787 coach, but only 2 first class. That's 50% more right there, plus there's more leg room so it's worse.
Their margins are already thin even packing it as they do, so at only the equivalent of 2/3 current capacity that would be a recipe for failure. They'd have to charge probably twice as much.
I agree with this, whenever I think about the airline industry (and I do often as I travel 100% of my time for work) - I believe the only way we can really re-invent it, is to change the plane, not the airlines.
