Airline Expansion

[Porter70]

Hello All...

Im operating out of Philadelphia (PHL) and Im looking to expand my base to Kansas City (MCI).

I have two questions:  Is this the time to do it and how exactly do I go about expanding?

As for how, do I have to buy 4 gates at MCI, then create a base at 60x the gate cost?  Or do I just create a base without the 4 gate purchase?  Also, how do I ensure that aircraft I purchase start at MCI so I dont have to fly them from PHL?

As for the timing issue.  Operating out of PHL I work to most of the Northeast as well as Canada, along with a few routes to major Midwest and Southeast US cities.  However, I only own 4% of PHLs market share, but mostly because my main competitor operates at 3 to 6 route frequencies, while I maximize profit at 1 freq with 100% load capacity.  He has undercut me a few times, but it isn't an issue at all.  Aside from him, there is no real domestic threat from Philadelphia, as most operate from New York City's La Guardia or JFK.  My DOC is just under 900k and I have 8 aircraft in service, ranging from short range CBY-3s and CM-100s to DC-3 and DC-5s.

I have been saving, anticipating the cost of purchasing 4 aircraft to operate at MCI, 4 gates at MCI, and the 60x base fee, (all of which I figure to be 21 million total), and so far I have 12.5 in the bank.  Should I continue to expand services at PHL?  My future plans include operating bases out of Houston and LAX as well, but those plans are well off.  I figure MCI gives me access to the entire nation, which is why Im moving so early on the city.  Should I wait?  Or is this a good time to move?

Thanks...

[pseudoswede]

As for how, do I have to buy 4 gates at MCI, then create a base at 60x the gate cost?

Yes.

Also, how do I ensure that aircraft I purchase start at MCI so I dont have to fly them from PHL?

New planes are automagically (and instantly) delivered to the base you want them to fly out of.

As for the timing issue.  Operating out of PHL I work to most of the Northeast as well as Canada, along with a few routes to major Midwest and Southeast US cities. ... My DOC is just under 900k and I have 8 aircraft in service, ranging from short range CBY-3s and CM-100s to DC-3 and DC-5s.

Define "most". There are probably close to 200 airports within 800 miles of PHL. Do you fly to all of those yet? With a DOC of 900k, you're better off buying more planes and increasing that to at least 3M before even thinking about opening a new base.

[Porter70]

Most would be not nearly enough of the smaller locales.  I fly to a large number of larger airports, but those smaller destinations are somewhat left out.  I fly to as small as Marthas Vineyard and University Park etc, but you are right, theres plenty of work to do in terms of local expansion.

Thanks.

I just orderd 3 more CBYs and a DC-5 to help cover more of those routes both in that short and mid range area, I sure Ill be ordering more.

[kcclieou]

Which world are you in right now?

I would say that operating to small airports is probably not very profitable, because of the relatively small number of potential passengers. I am in world #506 for 18 game months, based initially in a $250,000 airport. I decided not to fly to airports with value $100,000 below (except 4 of them which were really close to my base). Most people don't do it this way, but this strategy seem to work for me - I now own 3 bases with a DOC of over $9,000,000 and 40 propeller airplanes, serving 49 destinations and over 100 routes, and is planning to expand further.

$12.5 mil cash is good for a new prop, which can earn you something between $200,000 and $300,000 each day if you plan routes and schedules well enough.

Probably the best thing to do is to expand your services at Philadelphia first to cover all airports within, say, 1500nm of your range, then set up a new base (by the time you set up a new base, Kansas will probably be a nice choice; places like LAX and IAH are already too crowded). And make sure that you have new aircraft readily available when your new base opens.

[Porter70]

Im in a private world, but Im unsure of which one.  Its a custom name...  Its only 1951 so everybody is still really in their infancy and nobody truly dominates a market, although theres maybe 10 airlines with values in the billions, but the dropoff is steep (Im in the low 20s at a value of almost 30mil)

I dont operate any planes that seat less that 14, and I usually fly the small planes to the small airports, mostly because they had 0 competition and it was easy to come in and make a good profit flying one plane to 6 or so places all within a really short hop.

Now that Im trying to grow, Im looking to start battling people over other routes.  My competitors all fly destinations with 3+ freq. and I fly only .5 to 1.5 freq depending on plane availability hours.  I dont see the value in using so many hours on a single route when I can operate one plane over several routes, thus keeping my maintenance and plane purchase fees down, and my DOC more than competitive.

As for expansion, Im now considering the likes of Vancouver, San Diego, Seattle, Portland, Edmonton, Calgary, and Boston to go along with PHL and eventually MCI.  Im working my DOC to 3+, Im almost at 2mil as of now.

Would it be worth creating a hub at Boston despite the proximity to PHL?  Im not sure if this game takes that into account, Ive only been playing for a few weeks.

[kcclieou]

Would it be worth creating a hub at Boston despite the proximity to PHL?  Im not sure if this game takes that into account, Ive only been playing for a few weeks.

There are pros and cons to this - the obvious advantage is that you can strengthen your network in that area a great deal and maximize gate usage (thus saving gate costs when opening new routes). In fact my three bases are within 200 to 400 nm of each other, and there are lots of destinations that I am serving from all three airports. Right now I am serving far fewer airports than airlines with similar ranking, though my airline value seems to inflate slightly faster than these other airlines.

But again, most people don't do it this way. It'll be left for you figure out for yourself which is best.

[Porter70]

I think BOS, PHL, MCI and a city to be named later would be a strong network.

The Northeast/Rust belt/Midwest redundancy would save me money in terms of gates, and having a western city as my final hub would help me complete my coast-to-coast plan I envisioned when I chose PHL.  Anything that will prevent additional costs while hauling in a few million more is certainly something I look forward to doing.

Thanks, I think I've rounded out a framework for the future...