Kavafian TV | WJ Finance | Board Surf

[Kip Powick]

You are so right !!! Now why is that????

[CanadaEH]

How is changing its strategy a bad thing? Its called 'adapting' to an ever changing market. With all the taxes and fees the government is charging airlines nowadays, Westjet cannot afford to launch service into smaller communities - hence the growth into larger markets (i.e. St John's, Gander, Halifax, Montreal).

Realize that most of the flights to these cities are with very low frequencies - plenty of room for growth. The reason service was started in the first place was simply to get a foot in the door. I see Westjet taking advantage of Air Canada's downsizing, does that go against their original strategy of careful growth? Sure. Did they plan on Air Canada going into bankruptcy protection? No. Did anyone ever think Westjet would install LiveTV? No. Things change, which is why I have no problem with Westjet's strategy changing. They're adapting, with profit, to the ever changing market. Smart, don't you think?

Successful companies adapt, bankrupt companies don't - sorry if this is insulting to anyone, but it's true.

[Maverick]

I admit, I am mystified by your arguments. I will take them in order:

1) "Who is bashing here?"

Please see Mitch's response.

2)" Klyde running a company which buys its A/C at the top of a bubble by diluting the stock"

a)First off it's Clive,

We have never stopped buying aircraft at any point not 9/11 not SARS not gulf war II

c) The stock started at $10, split twice (3 for 2) and is now at $25, that's actually a gain not a dilution.

3) "changing a strategy to market share instead of careful growth, and talking turboprops."

Turboprops? Pour qoui?

4)"I can tell you that many a pile-it at Wetjest will be seriously &%$@! if flying is given over to Hawk Air or proposed operators like Regco."

a) It's WestJet

We won't fly a root that won't support a 737, period.

5) "My aim is to discourage any argument related to comparing WJ to ourselves, which is the reasoning for the tearing up of our contract."

I'll do it for you, One is profitable one is not, the comparisons will continue. (I promise you!)

6)"I don't come here to specifically "bash" Wetjest"

a) Yah, right

It's WestJet

Final point, if you have returns of 30% on your investments in 3 months or so we won't see your smiling face indicating emergency exits for long will we?

[Guest ECB]

I think he was in reference to the ESP where as long as the stock price remains stable, it would be a 50% increase. If not, he would be a bit over the top since all stocks can and do dip or at least level off. No need to rub noses in it.

A lot of folks at WestJet worked at other carriers before that were targeted by AC (ie: C3, Nationair, Greyhound, ICN, 9A, Astoria, VistaJet etc...) fairly, or not and thats where some of the testiness and lack of sympathy from some of the WJ crowd may come from. On the whole, I think most of us don't want to see anyone in the situations some of us have been in before.

[wjaer]

I meant it is matched with th ESP.

[Guest AME]

The problem is that as AC tries to "Adapt" or hold onto their market share they're accused of predatory pricing, flooding a route with capacity etc... Even the foot hold that you're talking about WJ establishing in traditional AC markets is called bad business when AC does it (YXX? Abbotsford)

" Successful companies adapt, bankrupt companies don't "

Very true, so if AC does emerge from bankruptcy, it will be safe to assume that you'll consider them successful??

I understand that your feeling toward AC are a little jaded based on the experience of a relative, and the subsequent (somewhat arrogant) responses you got from a supposed AC employee, but believe me the snipping between WJ and AC will continue as long as they're around, look at the war still raging between ex-CP and AC employee and they all now work for the same company

Brett

[CanadaEH]

Air Canada was not adapting, lets get this out of the way first.

I am all for competition - HEALTHY competition, Westjet competing against Air Canada, or Air Canada competing against Westjet. The difference between the two is that the latter (AC vs. WJ) has been competing in an unprofitable manner.

You used YXX as an example, so lets go with that. Air Canada decided to give this route (YXX - YYC) a go with Zip, which I have no problem with. After all, if Westjet can do it, why can't Air Canada? The route was obviously not doing well, so the prices dropped.. and dropped.. until they were half of Westjet's tickets. Yet, they still managed to fill less than half of their planes -

day in, and day out. A smart company would have pulled the route (if I'm not mistaken they still operate that route now?).

Westjet operates many routes, at a cost they can afford to charge. Would that be called predatory pricing against Air Canada? I don't think so. Air Canada charges fares at prices they can't afford to - I call that predatory pricing.

So in the end, has Air Canada adapted to the changes in the market? No, they aren't. Please prove me wrong if you don't feel the same way.

[Guest AME]

I'll not argue with you as your mind appears to be made up

My point is that AC is adapting (all be it through CCAA), this is not to say that WJ still won't kick their butt, however ZIP will be in a position to actually compete with them, why do you think WJ has adapted their plan to include TVs,FF points and the res thingy, they know that the predatory argument may have been valid against AC, but it won't stand up against ZIP, so they're now offering more features to attract the masses.

Brett

ps: FYI I'm not a dyed in the wool AC fan (as many here can attest to) However if you approach the whole issue from somewhere in the middle you'll find that there isn't much difference between AC and WJ (Simcoe and Nova not withstanding )

[wrench]

PEDANTIC.................WOW. I LIKE THAT WORD. THE LAST TIME I HEARD THAT WAS IN GRADE 10 WHEN MY SCIENCE TEACHER CALLED MY FRIEND PEDANTIC. I ALWAYS FIGURED THAT ANYONE THAT WOULD USE THAT WORD WAS IN FACT "SHOWING OFF HIS/HER KNOWLEGE". but I do agree with your summary of Francis take on things. HE'S OUT TO LUNCH! (AND YOU DON'T HAVE TO LOOK THAT WORD UP)

[Mitch Cronin]

pssst.... wrench... ya don't haveta yell.

[wrench]

sorry. didn't mean to be PEDANTIC.

[Guest Operation Bomberclad]

How am I out to lunch? I am trying to show up the lie that a low cost business model in the airlines is a magical gold-spinning business plan. That is my object here. Thank-you all for providing me with your own viewpoint. You will most certainly get a fill of mine.

The low cost model has one major drawback. In a scenario where there is over capacity and dwindling passenger numbers(or too much growth), there is no room for raising prices.

There is also another minor drawback to relying on making statements on somebody else's airline that they are inclined give whatfer on that very issue.

About Being Paid In Stock Options

I would like to point out to stock option boosters that many an employee were optimistic about holding AC stock during the run-up with ONEX at around $20.

They all lost out on that money and it didn't do a damn thing for them.

Each and every one of them were able to opt out and had full control over their stock to sell at any point. Each and every one of them hung on for dear life, and lost thousandS or tens of thousands.

Show me the money, please and don't forget that a regional F/A's productivity numbers on a 50-seat jet are the highest in the land. Bar None. Even WET JEST

And So Say I.

:[

NZ

[gonzo]

"I would like to point out to stock option boosters that many an employee were optimistic about holding AC stock during the run-up with ONEX at around $20".

That was purely foolish. Have you heard the phrase "too good to be true". I hope most employees recognized that. The big losers were A/C and the big investors (Caisse et all, hyphen where appropriate) and Gerry and the boys were the big winners. Had to hurt the bottom line which we are feeling right now.

[E-HANDLE]

Well, you are certainly entitled to your point of view.

The facts, of course, don't give credence to that POV. In a down aviation market (and I have never seen one this down), who is making money? The usual suspects; Southwest, JetBlue, Frontier, and WestJet. All of these airlines are also expanding with new aircraft, more frequency, and new destinations. You can call it magical, or gold-spinning, or whatever, the fact is, it's happening.

Pricing power is another issue. It's true that during times like this the pricing enviornment is difficult, with the major carriers chopping prices to unsustainable levels in an effort to drive out the true LCCs. The results are predictable, and generaslly horirfic. The majors lose loads of cash, to no avail. Just like after the first Gulf war, the "airline within an airline" becomes the flavor of the month. Shuttle by United, Delta Express, MetroJet; they were all supposed to be the answer low cost competition. They weren't.

Now what have you got? Delta has Song, United says they are going to start another LCC, and USAir is a basket case. Song is purportedly patterned after Tango, which is on it's way out. Zip is doing for AC what MetroJet did for USAir.

Eventually, the majors go back to being majors, our they bleed out, ala USAir, United and AC.

As for the CEO's of the LCC's stating the obvious being offensive to you, I can only say I would rather have a CEO who is vocal, than one that waits until it's too late before making a sound. Being a soft-spoken gentleman didn't work so well for Kevin Jenkins, Angus Kinnear, or that nice man from Roots Air. Wasn't Roots going to be AC's LCC?

Herb Kelleher earned the nickname "the mouth from the south", a mantle he wears with pride. For over thirty years, the majors were going to put him under, but he didn't take it laying down. Good on him, I say.

[Mitch Cronin]

Re: "overcapacity"

While AC may have overcapacity, WestJet, apparently does not. While we continue to squander our once 80% market share, WestJet continues to welcome new "guests"...

Re: " I would like to point out to stock option boosters that many an employee were optimistic about holding AC stock during the run-up with ONEX at around $20."

Surely you jest? Hardly a comparison worth even an attempt.

[CanadaEH]

Couldn't agree with you more, well said!

[dr1]

I'm so glad that amused you wrench. I figure that was the one time in my life I could use that word and it would be entirely appropriate.

[dr1]

You weren't being pedantic, just vociferous, maybe voluble.