Well, things aren't looking great for my airline right now -- not so much because of my own choices, I think, but more because of circumstances beyond my control. At this point, I'm trying to decide whether it's even worth attempting to salvage things. Here's the story (which, as one of my alliance members has pointed out, sounds like a soap opera).
Back when demand plummeted post-9/11, my airline was doing furious battle with another, somewhat larger airline for control of my base airport. I narrowly survived the drop in demand, but my competitor did not. I was able to recover and was well on my way to building myself back up. Then the following sequence of events occurred in very short succession (not mentioning names):
(1) Airline A with 3 bajillion dollars opens secondary base at my home base airport.
(2) Airline A then opens another secondary base at a bigger airport (which is home base for Airline B).
(3) Airline B, which has 20 bajillion dollars, retaliates by opening secondary base at Airline A's home base airport.
(4) Airline C, which is also based at the same airport as Airline A and which similarly has approx. 3 bajillion dollars, responds to the arrival of Airline B at its home base by also opening a secondary base at my home base airport.
(5) Airline D, which has eleventy gazillion dollars, opens secondary base at my home base airport.
(6) My home base airport houses me, Airline A, Airline C, Airline D, and a fifth, much smaller airline. The degree of overcapacity is beyond absurd.
(7) Airline A and the small airline eventually go bankrupt.
(8 ) Me, Airline C, and Airline D remain in my home base airport.
Airline C has swamped virtually all domestic routes with excess capacity, but has been careful not to break the 200% capacity rule. And since Airline C has 3 bazillion dollars, he can absorb any losses. Meanwhile, Airline D has focused more on going after international routes, showing a slight preference (I think) for opening routes that I'm already flying vs. routes which may be more under-served. As with Airline C, Airline D has so much money that he can absorb any losses incurred.
Question: though I do have a secondary base, I'm not sure if it can compensate for the problems I'm having at my main base. Should I just throw in the towel at this point?
Follow-up question: how much would doing, say, an across-the-board 50% fare reduction affect my competitor's loads? (If they can deliberately trash my loads, it's only fair that I be allowed to do the same).
Follow-up to the follow-up question: in general, is there any real way to fend off aggressive, well-capitalized airlines in this game (insofar as the overcapacity limits provide little meaningful protection and the number of planes that can be placed at a secondary base has gone up, making life far too easy -- in my view -- for airlines intent on expansion)?