Route Competition

[shaunly]

Looking for a bit of advice please ... as I'm considering opening a route where there would be competition. 

The route has a demand for approx 720 pax/day.  My competition currently provides approx 400 seats/day, but operates the route with a 3x/day frequency.  My intention would be to provide an additional 200 seats/day, but with only a single flight. 

Obviously, the demand is present for the additional 200 seats/day, but am I going to lose money on this route because I'm operating it less frequently than my competition?

Appreciate any advice, input, explanations, criticisms, etc.
Thanks!

[exchlbg]

You are not going to loose, but you will sell a bit less than equal, or you have to be a bit better in some other values (price,flight timing,seating,RI,CI).

[Mr.HP]

Demand = 720
Supply = 600

So, in normal circumstances, I think both airlines will operate with almost full LF, right?

Frequency benefit will kick in when total supply > demand. Even so, you won't lose money. You just have lower LF% in comparison to competitor's, thus revenue rate might be a little lower, too

[Curse]

When there's a demand of 720, I clearly see about 800-850 seats you should offer.


If you operate a single flight offering about 200 seats you'll make of course money on this route if your Route Image has grown a bit. There's no big frequency bonus in 1vs3, if you go up to 2vs3 frequency bonus is nearly gone.

[shaunly]

Thanks for the input everyone.  I opened the route and I'm seeing basically what has been indicated here.  Just shy of a 50% LF, but making a profit on the route nonetheless.