from the BBC - they need to buy some new planes, and biz class will be expensive.

http://news.bbc.co.uk/2/hi/business/7705169.stm

I'm curious how the U.S. Legacy carriers will respond to this...

Most carriers will ignore them. And on each flight, there will definitely be only a very limited of seats at that price.

Longhaul budget carriers have not worked in the past (Laker), or more recently (Oasis; and a long list of carriers that'd served Canada-UK). Nor has it worked with premium service (Maxjet, eos, Silverjet and L'Avion).

Laker lost because of illegal tactics of the other airlines

Zoom and the like lost out because they didn't fly London to NY.

BUT then Officialdom & Michael O'Leary don't go together - so unless O'Leary declares Bangor to be New York North, expect a lot of disappointed customers

Anyone who thinks there's only one model for operating a route as busy as London-New York or Florida is just one step from going bankrupt himself.

There are three low-costs already successfully operating between London and Florida - a market that's dominated by British holidaymakers - and if a small provincial airline like Continental isn't aware of them, I'd worry about the blinkered ignorance of its management.

The real reason Zoom, Oasis etc went belly up was that they launched at a boom time and hadn't got themselves established before the market turned down. With a handful of routes, they were just too vulnerable.

Ryanair, by contrast, is in better financial shape than the legacy airlines it's attacking across the Atlantic, is on many measures bigger than them - and O'Leary's a far bigger bastard than any of them.

Try pulling the stunts on O'Leary they tried on Freddie Laker, and the legacy operators will find themselves on the receiving end of much nastier stuff, damaging themselves a great deal more than they damage him.

The jury's out on whether O'Leary will make Atlantic flights work. Anyone who thinks the result's predictable is a fool. Any airline that ignores him will be out of business a lot sooner than Ryanair.

O'Leary may make it work, but the legacy carriers will ignore them, which was my first point. The other longhaul budget carriers - say those UK holiday charters to Florida - constitute a very small portion of business, and a low-yield business. The main carriers decide it's not that in their interest to compete in that market.

Very well put <b>rkkwan</b>.

Anybody that thinks RyanAir will steal legacy customers must be smoking something really good. Flying Sanford to Dublin is not exactly very convenient to most of the legacy airline passengers. How is a passenger from Champaign, IL or Canton, OH suppose to get to Sanford, FL? By the time one has to purchase a ticket from their hometown to Florida, take chances with misconnections, etc, it will be just as or possibly more expensive to just buying a ticket with a legacy airline and flying through a major hub to get to Europe. US is little bigger than UK or IR where it's very easy to take a train or bus to the airport. Majority of the population need to connect at major hubs in order to fly across the big pond and they can't just take an hour train ride to Florida or even New York to hook up with a low cost carrier.

This is definitely a challenge to the UK low cost carriers that fly UK and EU holidaymakers across the pond, a not very lucrative market to begin with, but I really don't think the legacy airlines are losing any sleep over it.

<i>I really don't think the legacy airlines are losing any sleep over it.</i>

They may not be losing any sleep over it (US airline executives don't have a strong track record of long-term strategic thinking), but they should be. This ain't some new operation with limited funds. Ryannair has a history of innovation and will surely have more money to play with (at launch) than virtually any previous international carrier. Not to mention the fact that they already have a profitable business that can subsidize early losses. I don't fly Ryanair, and I am not guaranteeing this will work, but any airline executive that doesn't take the threat seriously should be fired.

<i>Majority of the population need to connect at major hubs in order to fly across the big pond and they can't just take an hour train ride to Florida or even New York to hook up with a low cost carrier.</i>

But this is only half of the equation. Stansted and Dublin provide a lot of potential connecting traffic on the other side of the pond. Do you think that BA serves 20-some US markets because of good US connecting feed? They likely generate that kind of traffic because they can offer connections to elsewhere in Europe.

Besides, you don't need to serve all of the US to seriously hurt the legacy carriers. I would be willing to wager that most of the people flying AA from JFK and BOS to Heathrow aren't connecting from elsewhere. If Ryanair can take even 5 or 10% of that traffic, then that changes the economics of those flights completely.

<i>Bangor to be New York North</i>

I don't think it will be that bad. I believe O'Leary has previously mentioned Islip and Providence as potential airports. I think there are runway length issues at both, but I'm sure somebody will work something out (Portsmouth, NH perhaps?). I wouldn't even be shocked to see one of the major airports open their doors.

<i> Do you think that BA serves 20-some US markets because of good US connecting feed? They likely generate that kind of traffic because they can offer connections to elsewhere in Europe.

Besides, you don't need to serve all of the US to seriously hurt the legacy carriers. I would be willing to wager that most of the people flying AA from JFK and BOS to Heathrow aren't connecting from elsewhere. If Ryanair can take even 5 or 10% of that traffic, then that changes the economics of those flights completely.</i>

I basically disagree with your entire post but I totally disagree with the above statement. Of course BA has a great feeder network. They partner with Alaska, American, etc.

Who is RyanAir going to partner with? to bring in folks from all over the US to their hus)? They have not partnered with anybody before, so unless their business plans change, they will be resigned to the UK, EU holidaymakers market.

The majority of BOS or NYC AA flights to LON are fed from a very extensive AA network. I for one have to fly through MIA, ORD, JFK or BOS when going to EU. In my case it just depends which flight(s) have upgrade availability. I'm one of tens of millions of folks that live in mid-size towns that don't have direct flights to EU or Asia or SA, etc.

And finally, do you really think the legacy airline COs lose any sleep over Thomas Cook, Monarch or FirstChoice flights from UK to Sanford, FL?

I don't think so......

<i>I'm one of tens of millions of folks that live in mid-size towns that don't have direct flights to EU or Asia or SA, etc.</i>

And there are tens of millions of people that live in mid-size towns and cities in Europe without direct flights to the US. To the extent that they might choose to connect through Stansted or Dublin, then it remains unclear why that doesn't (potentially) provide much the same advantage to Ryanair on one side of the pond that the US carriers have on their side.

All that being said, I think you overestimate the size of the connecting traffic. I recall reading that roughly 50% of the seats for CO's TATL flights out of EWR are occupied by connections. Impressive, indeed, but it means that half of the plane is occupied by local traffic. That is a lot of traffic for Ryanair to poach. I can see no reason to believe that AA's connecting traffic at JFK or BOS is any higher than CO's at EWR, given their much smaller hub (or focus city in Boston's case) activities.

<i>Of course BA has a great feeder network. They partner with Alaska, American, etc.</i>

But how much traffic do those partners bring to places like DEN, MCO, TPA, BWI, IAD, PHL, IAH, ATL, EWR, or PHX? I can't think of many partners in any of those airports that offer the potential of significant connecting traffic. And it wouldn't be of the small-town variety. If BA can find a reason to serve all of those cities with what is likely minimal connecting feed, I see no reason why Ryanair can't serve Boston and New York, without it.

Ryanair doesn't need to eclipse the size or reach of AA or CO or whomever. They merely need to poach traffic from some of their most profitable routes - routes like NYC/BOS-LON. If they can do that, it spells major trouble for the legacy carriers. It is precisely these routes where the legacy carriers have gone searching for refuge from the squeeze in the domestic market. They have basically lost the domestic market and Southwest is now the 800-pound gorilla in that fight. They are not profitable as it is; do you think they can survive a serious (and this will be much more serious than Zoom or MaxJet) attack on their backup plan?

I normally think you are right on when it comes to the airline industry, but I think you might be a bit off the mark on this one. I am certainly not predicting the winner, I am just predicting that this is not a good thing for the legacy carriers and is not something they can ignore.

All the smaller cities you mentioned, of course AA can be a great feeder for BA and it is. BA codeshares on most of these routes with AA.

Besides, RyanAir is a point to point airline so even their extensive EU network doesn't help if something goes wrong with the 1st flight, meaning that you will have to leave security in the connecting airport in EU, check in again and go through the hassle of security again, unless of course, they decide to change their business plan. That remains to be seen.

Like I said, RyanAir will get some of the EU holidaymaker business, but it's nothing to lose sleep over for the legacy airlines.

I'd not overestimate the value of legacy networks/connecting flights. In my part of the world just as many (maybe more) people either drive anywhere from 1 to 6 hours to the international gateway - or they fly Southwest or Jet Blue.

Sure - lots of people do use the legacy's connections. But there is a LOT potential market for a RyanAir-type flights.

Well then tell me why a vast majority don't go out of their way and fly FirstChoice or Thomas Cook out of Sanford, FL, or Condor (a subsidiary of LH) out of Fort Myers or Miami(not sure about that one)?

It's the EU holidaymaker market these low budget airlines are after, not competing with the legacies. They are happy about it and I'm sure RyanAir will be happy with it as well, but I'll say it again.....nothing to lose sleep over if I were legacy airline.

The major legacy airlines on both continents get a huge portion of their business from business travelers in all classes, a lot of them by contract with their employers.

That's the bread and butter of those airlines, and Ryanair will not be taking any of those business from them, even if they're flying LHR-JFK, which they won't be.

Most of us here travel for leisure. What we do has nothing to do with those flying for work.

<i>All the smaller cities you mentioned, of course AA can be a great feeder for BA and it is. BA codeshares on most of these routes with AA.</i>

Except they don't codeshare on these routes that I am aware of - for the same reason you can't earn or redeem AA miles on BA flights across the pond. The only AA/BA codeshare that I can think of is the smattering of ex-MAN routes, some of which I think have been canceled.

<i>The major legacy airlines on both continents get a huge portion of their business from business travelers in all classes, a lot of them by contract with their employers.</i>

And they have lately been having to sell the farm to get those contracts. My company now pays around $2k for business class tickets, BEFORE the volume discounts. In my experience, once those prices are dropped, they never go back to the heights they reached before. Look at what happened to domestic F fares, which are now a fraction of what they were only a few years ago. The legacies' revenues are already getting squeezed at the corporate end. They may not be able to afford to have Ryanair squeezing from the other.

I must confess that all of this talk of corporate travelers and networks and the like gives me a sense of deja vu. I mean, weren't these the same arguments that were made shortly before the LCCs started setting the rules of the domestic US and intra-European markets? Given the track-record of the US legacies for the past decade, it is quite the leap of faith to think that a couple of corporate contracts and a global network will be enough to prevent them from getting beat by nimbler, smarter competitors once again.

<i>Except they don't codeshare on these routes that I am aware of - for the same reason you can't earn or redeem AA miles on BA flights across the pond. The only AA/BA codeshare that I can think of is the smattering of ex-MAN routes, some of which I think have been canceled.</i>

huh???

I wasn't talking about the big pond codeshares, I was talking about BA having an extensive codeshare agreement once they get their passengers to or I guess you can say, feeding into the BA system in the US.

here it is:

http://www.britishairways.com/travel...h/public/en_us

<i>I was talking about BA having an extensive codeshare agreement once they get their passengers to or I guess you can say, feeding into the BA system in the US.</i>

And just how many AA passengers are connecting at TPA or DEN or BWI or PHX? For the most part, the only flights AA has into the airports I listed are to or from AA's hubs. I don't see a significant number of people flying DFW-TPA-LON. Heck, it doesn't even show up on ITA unless you force it to.

It simply isn't reasonable to think that anything more than a handful of numbers of fliers eschew a non-stop flight from an AA International Gateway (almost all of which have a non-stop BA flight, as well), simply to book a connection with BA through a secondary city. Perhaps (and I'm really stretching here), there may be some minimal connecting feed from STL, but even that.

I wonder why the biggest and most successful low-cost carrier in the world - Southwest - isn't flying across the Atlantic, now with Open Skies. And they won't even fly 1/3 across the Pacific to Hawaii.

Again, here are my two main points, and I will stand by them. If anyone doesn't agree, then we just won't agree.

One is that the LCC and legacy carriers serve different markets. In Europe, AF/KLM and Lufthansa are doing just fine despite the presence of Ryanair and Easyjet. Singapore is served by quite a few LCCs, but SQ remains one of the most profitable airline in the world.

Second is that the low-cost model doesn't work well for longhauls. There are fixed costs - aircraft and fuel - that any airline has to pay. There many be niches like US-Florida vacation markets that can support some flights, but otherwise, there's no track record in aviation history of successful longhaul budget carriers.

If O'Leary makes it work and become highly successful, more power to him. But I hope some of the posters won't be complaining here about lack of service, or tight legroom, or the non-stop merchandise selling onboard.

so, allow me to put it differently...because apparently you have a hard time understanding something here....

Let's just say I want to go from Sarasota to Warsaw,

my choices are as follows:

AA/BA - SRQ-MIA-LHR-WAW-LHR-MIA-SRQ - all on 1 ticket and getting miles/upgrades/lounge access, etc....

or

?? SRQ-???-???-ISP-STN-WAW-ISP-???-???-SRQ on 3 separate tickets, no upgrades, no lounges, etc...and a great possibility of misconnect.

for about the same price by the time you figure in all the layovers, and the time you need in between because RyanAir is a point-to-point airline, so I need to make sure I'm there with enough time to re-check and I need to eat and drink something between the hours I would be sitting at these airports.

Guess which one I would pick?

The RyanAir option should be:

SRQ-???-???-ISP-STN-WAW-STN-ISP-???-???-SRQ....