More bad news from EVA

[Neon Ninja]

 

More distressing news from EVA Air, I just hope they don't screw with USA flights anymore:

 

EVA Air leaves New Zealand

 

Taiwanese carrier Eva Air is pulling out of New Zealand services from September because of high fuel prices, the first airline to do so.

 

Sales manager Erik Lee said it would be silly to pull out altogether, given their presence in Auckland for 14 years flying direct flights to Taipei on Wednesdays and Fridays.

 

Some sort of marketing presence is expected to remain out of Evaâ??s 10 New Zealand staff.

 

Mr Lee said it was purely the cost of flying to New Zealand that has led to the suspension of New Zealand services, with jet fuel currently at around $159 USD per barrel.

 

Eva Air will continue with three flights a week to Brisbane, but will cut back 70-80 flights per week globally after an operational review.

 

Mr Lee said he was hopeful the service could be reinstated one day if fuel prices dropped and the recessionary global economic picture improved.

 

Rumours are mounting in the aviation industry that a further two Asian airlines may soon pull out of direct flights to New Zealand, going through Australia instead.

 

-=/NN

 

[Bangkoktraveler]

I got a feeling this is only the beginning.

[matta330]

Mr Lee said it was purely the cost of flying to New Zealand that has led to the suspension of New Zealand services, with jet fuel currently at around $159 USD per barrel.

 

 

I know this EVA news actually came out a couple of weeks ago, but come on, today oil is below $114USD/bbl. I think some asian airlines are using fuel as an excuse to cut flights that they wanted to cut anyway, but would lose face if it were for any reason but fuel.

 

[USVirgin]

I know this EVA news actually came out a couple of weeks ago, but come on, today oil is below $114USD/bbl. I think some asian airlines are using fuel as an excuse to cut flights that they wanted to cut anyway, but would lose face if it were for any reason but fuel.

 

It's political and it's competitive. Bilateral and multilateral air service agreements exist between countries. You cut costs by bailing out of a market from which you think you may re-surface at a later time, not the one you consider precious for the long term.

 

I have no idea about EVAs strategy. I'm just saying that the chopping block is not as simple as it might seem.

[matta330]

It's political and it's competitive. Bilateral and multilateral air service agreements exist between countries. You cut costs by bailing out of a market from which you think you may re-surface at a later time, not the one you consider precious for the long term.

 

I have no idea about EVAs strategy. I'm just saying that the chopping block is not as simple as it might seem.

 

I agree with you. Just because a flight is full does not mean the airline is making a profit on that flight (see U.S. airlines flying full to Orlando). I just think that some routes are being cut that would not normally, but fuel is a good excuse.

 

Look at TG and their BKK-JFK flight. They never priced it right to start with, so it never made any money. Once fuel prices started to go up, it had to be cut, but the timing had to be right. Unfortunately, TG cut the flight without much notice and a lot of passenges got screwed, and are rightly upset.

 

On the other hand, Cathay Pacific is doing some minor cutting, but doing it the right way. The example I'll use is their daytime LAX-HKG flight. Again it was a flight that never did that well, and then when Cathay also started an SFO-HKG flight, loads on the LAX flight dropped further. So Cathay is cutting that flight, but is giving at least a couple of months notice (instead of the two weeks that TG gave for their JFK flight), and has the flight coming back in Oct. of '09.

 

EVA has not said anyting about the AKL flight being a temporary suspension. And quite a few other carriers have left the AKL market lately as well.

 

[USVirgin]

Thailand has an open skies agreement with the US, so TG can come and go as they please, but I don't think TG ever broke even on its US operations. The nonstop was certainly their best chance, but I don't think there's ANY way to price it correctly. Just not enough business travelers in the mix, and extremely competitive pricing at the lower end (for example, you can buy a ticket to Bangers on Korean, via Seoul, for a few hundred $ less than if you only went to Seoul). That's the kind of competition TG has to deal with.

 

When they fly via Japan, they really get screwed on the transpacific legs, because of brand loyalty in the US-JP market. If you look for the cheapest consolidator fare to Japan, it will likely be on TG (or possibly Korean, for the same reason).

 

Their only hope to break even on the route is from the origin Japan to Thailand traffic. Fares originating Japan are always healthy for an airline! I was surprised to learn that Korean, despite operating something like 80 passenger flights a week to the US, makes more than double that revenue on the Korea to Japan puddle jumps.

[samak]

TG is also moving out of New Zealand! see the thread "Ailing THAI asks hundreds of staff to retire early"