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Author Topic: Hybrid Strategies... Impossible?  (Read 1803 times)

auerbacs

  • Former member
Hybrid Strategies... Impossible?
« on: March 11, 2010, 10:37:10 PM »
I currently run a mostly regional airline (Perseus Airlines) out of Detroit. I have over 100 planes, many of them very small, and I run mostly routes where the demand is low enough that I have no competition. Because of this, I have a pile of routes (all ABCBA) and and I avoid marketing almost entirely. Now I find that I am pretty much filling demand on short-haul low-capacity routes in the region. The problem is, I can't really expand to larger more competitive routes, even if I buy new planes, because I can't increase my CI enough without my marketing cost skyrocketing because of all of my smaller routes. So it seems to me that once you make the decision to be a regional carrier, and to focus on those short routes with little marketing, you can't then make the decision to compete on larger routes, making a hybrid strategy impossible. Do others interpret my situation in the same way. I could try to sell all of my smaller planes and buy a pile of larger planes (737s, probably), but I would be selling my planes for 50 cents on the dollar, if at all. It would be like starting the game again with a higher starting money... Does anybody find that the regional/standard hybrid strategy is feasible? Is there anything I'm missing?

Thanks,
Auerbacs

Misterfeep

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #1 on: March 11, 2010, 10:50:09 PM »
I am running both short and long haul (AFP at IAD) but I built both networks more or less at the same time and always spent on marketing.  I think the issue for you now is that it may be hard to find long haul routes you can profit on given competition, slot shortages, and your lack of marketing to date.  Low profit means low marketing expenditures so you could be in a bind.  So not impossible, just difficult if you don't pursue both strategies at the start.  IMHO.

Talentz

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #2 on: March 12, 2010, 09:23:35 AM »
So you want to know if you can start as pure regional/small aircraft then go to larger/full service aircraft and not BK in the process?


Mm.. sounds tough and requires alot of time/focus. Im sure you could make it work... but is it worth all the trouble in the end? That would be my question.

Which is why I don't bother much with regional mentality... too much work for too little reward.

I'd rather create a large airline and crush other airlines play a f-fair and competitive game then bother with smaller aircraft.


But thats just me.


Talentz

pfmboidi

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #3 on: March 12, 2010, 11:39:55 AM »
I have tried both strategies and starting large is much easier.

Offline lastchancer

  • Members
  • Posts: 142
Re: Hybrid Strategies... Impossible?
« Reply #4 on: March 12, 2010, 02:07:44 PM »
For me, it is not only a question of max. profit. Im based in Anchorage, Alaska. Im doing low frequented routes with 10seaters (Piper Navarjo) and long national longhaul with DC 8s as well.

My goal is to satisfy the demands of my base Anchorage and the state Alaska. This is the market Im targeting on only.So, my expansion is always limited. Feeling as a flag carrier , I focus on direct connections from Anchorage flown to "prime times". 2nd legs flights always go back to destinations in Alsaka, even if there might be routes to somewhere else with higher LFs.

This does not means to fly unprofitable routes, all routes are optimizeded on LFs and are profitable. It is just to offer best serviceand connections on the routes to Alaska. This brings higher LFs on my routes than others who just fly to Alaska to fill in empty spaces in their timetables. 
My income is quite well and the domination and the market share in my area are the main parameters for me to evaluate the succsess of my airline.

Best,
Lastchancer
Anchorage Airways: http://www.airwaysim.com/game/Info/Others/Airline103

« Last Edit: March 12, 2010, 02:11:52 PM by lastchancer »

Misterfeep

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #5 on: March 12, 2010, 02:12:09 PM »
I still don't see it as an either/or choice.  I ordered both HS props and 707s and pursued both short-haul and long-haul from the start.  The long-haul did generate a lot more revenue but the short-haul was profitable and for the most part has always had zero competition.  I also used the short-haul fleet to drive the last competitor based at IAD out a long time ago.  Having both gives you flexibility and a degree of slot control.

Offline NorgeFly

  • Members
  • Posts: 3651
Re: Hybrid Strategies... Impossible?
« Reply #6 on: March 12, 2010, 02:32:40 PM »
If you have a business model that works why mess with it?

In reality there are many airlines that operate only small aircraft to niche markets and it seems that you have done just that. Breaking into the big time and going head to head with the big boys could ruin you successful regional airline. Think very carefully before you do it!

Aahz the Pervect

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #7 on: March 12, 2010, 04:14:20 PM »
For me, it is not only a question of max. profit. Im based in Anchorage, Alaska. Im doing low frequented routes with 10seaters (Piper Navarjo) and long national longhaul with DC 8s as well.

My goal is to satisfy the demands of my base Anchorage and the state Alaska. This is the market Im targeting on only.So, my expansion is always limited. Feeling as a flag carrier , I focus on direct connections from Anchorage flown to "prime times". 2nd legs flights always go back to destinations in Alsaka, even if there might be routes to somewhere else with higher LFs.

This does not means to fly unprofitable routes, all routes are optimizeded on LFs and are profitable. It is just to offer best serviceand connections on the routes to Alaska. This brings higher LFs on my routes than others who just fly to Alaska to fill in empty spaces in their timetables. 
My income is quite well and the domination and the market share in my area are the main parameters for me to evaluate the succsess of my airline.

Best,
Lastchancer
Anchorage Airways: http://www.airwaysim.com/game/Info/Others/Airline103



Having grown up in Anchorage, I'd be frustrated trying to start an Airline there and not be able to have a bush plane fleet to soak up all those tourist $$. You'd be amazed at what a New Yorker 'Fisherman' would pay to be flown to a virgin lake out in the middle of nowhere, lol

Offline lastchancer

  • Members
  • Posts: 142
Re: Hybrid Strategies... Impossible?
« Reply #8 on: March 12, 2010, 05:30:32 PM »
Having grown up in Anchorage, I'd be frustrated trying to start an Airline there and not be able to have a bush plane fleet to soak up all those tourist $$. You'd be amazed at what a New Yorker 'Fisherman' would pay to be flown to a virgin lake out in the middle of nowhere, lol
Maybe it depends on the game world you tried it out. The low fuel costs makes it maybe easyier right now.

The route to New York for example is profitable, although it is flown with thursty Caravelles and needs a technical stop.
Thanks god for all these crazy Fishermen in my seats!
But not to mention: my flight attendants are annoyed about all the fishing-rots in the cabin that doesnt fit in the overhead luggage!

Aahz the Pervect

  • Former member
Re: Hybrid Strategies... Impossible?
« Reply #9 on: March 12, 2010, 06:35:57 PM »
hehe - Fishing rods in the cabin.....boy do you have a lenient carry on policy!

Sorry, didn't mean to mislead. I've never actually tried an AK airline yet, I just know I'd be bugging Sami to code a special 'bush pilot' market for me  ;)

 

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