How to save the Airline Industry

[WillowRunVortex]

Ohh, I am sorry. I did not know the airline industry was a free-market. Someone please send a memo to BA, Air France, Quantas, Air China, Singapore Airlines, Cathay, etc. All are subsidized by their respective governments....

I dont know if you you dropped out of high school but the only thing we support in the US is the dairy farmer. Its called CAPITALISM,,,jeez read a book. What you speak of would be a form of SOCIALISM. not good

 

[WillowRunVortex]

NWA is going to file bankruptcy just so they can get rid of pension and scope and drastically cut the pay, benefits, and working conditions of all the employee groups. Management is too lazy to fix their worthless business model. It's much easier to pay a bunch of lawyers to take them into CH. 11 so they can balance the books on the backs of the workers. Delta will soon do the same (sorry General, but I think you know it's true). For goodness sake, just look at USAir. If every pilot in the company worked for free with no benefits the airline would still be losing money. THIS IS NOT A LABOR PROBLEM. THIS IS A MANAGEMENT PROBLEM. PLEASE DEVELOPE SOME SELF-RESPECT!!!!

Where did all the money that nobody had go? its big business,,,gimme gimme gimme,,look at GM same thing. Everyone gets overpaid ,until one day someone actually looks into the coffers and goes ah hold on a minute, theres nothin in here.

 

[PCL_128]

look at GM same thing. Everyone gets overpaid ,until one day someone actually looks into the coffers and goes ah hold on a minute, theres nothin in here.

Sigh... GM is the same situation as the airlines and so is Ford. It's bad management and bad business that's causing these problems, not overpaid workers. GM hasn't produced a decent car in years. Ford's latest offerings to try to compete with Chrysler's big hits fell completely flat. GM and Ford make boring, low quality cars that are overpriced. I say again, this is not about labor costs. This is about lazy and inept management.

 

[WillowRunVortex]

Sigh... GM is the same situation as the airlines and so is Ford. It's bad management and bad business that's causing these problems, not overpaid workers. GM hasn't produced a decent car in years. Ford's latest offerings to try to compete with Chrysler's big hits fell completely flat. GM and Ford make boring, low quality cars that are overpriced. I say again, this is not about labor costs. This is about lazy and inept management.

The expenses for an airline are as follows:

#1- Fuel

#2- Labor costs

#3- Everything else

which is it with this business model shall we (are able to) fix?

 

[PCL_128]

The #1 and #2 expenses for an airline are:

#1- Fuel

#2- Labor costs

which is it with this business model shall we (are able to) fix?

There's your problem, you're thinking like pinheaded management again. There are two sides to the equation: expenses and revenue. It's impossible to cut expenses to the point of saving the airlines, so the only solution is to increase revenue. Now you can debate how best to increase revenue, but however you do it, it must be done. No matter how many times they come at us for concessions they will never make the airline profitable.

Every time they get cost cuts they go right back to the fare wars. Every time they cut the frontline employee's pay then they're pi$$ing off the people that deal directly with the customers. Terrible employee morale does not translate to good customer service. Bad customer service translates to even worse revenue streams. Look at Southwest. They pay their pilots the highest narrowbody rates in the country. They get tons of days off and great benefits. They're the most heavily unionized airline in the country. So why are they not in the crapper like everyone else? Because their management team has a collective IQ of more 100! They have a good business model and understand that treating their employees well pays off tenfold.

You've got to think outside of the box and stop repeating the management talking points. None of the airlines will ever survive if they don't fix their business model instead of attacking labor.

 

[WillowRunVortex]

There's your problem, you're thinking like pinheaded management again. There are two sides to the equation: expenses and revenue. It's impossible to cut expenses to the point of saving the airlines, so the only solution is to increase revenue. Now you can debate how best to increase revenue, but however you do it, it must be done. No matter how many times they come at us for concessions they will never make the airline profitable.

Every time they get cost cuts they go right back to the fare wars. Every time they cut the frontline employee's pay then they're pi$$ing off the people that deal directly with the customers. Terrible employee morale does not translate to good customer service. Bad customer service translates to even worse revenue streams. Look at Southwest. They pay their pilots the highest narrowbody rates in the country. They get tons of days off and great benefits. They're the most heavily unionized airline in the country. So why are they not in the crapper like everyone else? Because their management team has a collective IQ of more 100! They have a good business model and understand that treating their employees well pays off tenfold.

You've got to think outside of the box and stop repeating the management talking points. None of the airlines will ever survive if they don't fix their business model instead of attacking labor.

Ah thank you and I got ya,,,guess what, the public is paying what it is willing to pay for airfare NOW. Anything more and guess what seat/miles go down,,,DRASTICALLY. Sorry but SWA and and the low costs will tell you they are doing just fine thank-you. So raising faires isnt an option! And a industry wide agreement is a Federal Offense.

 

[Crash Pad]

So there I was...

Final approach one engine on fire, shooting an approach down to Cat II mins, my captain is dead... Took a bird strike right in the face... Tower clears me to land but reminds me that landing in a tornado is not a good idea...

"Darn the tornado I have to get this thing on the ground!" I can hear the screams from behind me... all 50 pax are in some stage of panic!

Sound familiar... I don't understand how you can think some pilots could be overpaid. The amount of training and skill to pilot a modern jet from ATL to ORD is unimaginable.

You also have to remeber the top physical condition you have to stay in to keep your medical. I don't know about the rest of the pilots on this board but I train with Lance Armstrong on my days off just to meet the medical requirements.

Don't get me started on schedule... Just last week I only had three days off... That means that I was working for four days. Try and find a doctor or a CEO who is gone for that amount of time. Good luck!

Oh and speaking of responsability. Sure a CEO has to answer to hundreds of share holders or decide to layoff 100,000 workers... I along with a captain am responsible for 50 passengers... on a full flight. One screw up... just one little thing like pushing the push to talk at the wrong time and everyone dies.

YOU WANT ME ON THAT WALL.... YOU NEED ME ON THAT WALL

 

[rptrain]

and you a$$hole, you're lucky to be here!

 

[SDF2BUF2MCO]

Is that so? How many lives is that "exec" responsible for when he goes to work? How many approaches to mins in pouring rain and howling winds with 400 people sitting behind him does he do each year? How many medical exams and checkrides does he have to do each year to hang on to his livelihood? How many years did he have to make $15k/yr while "paying his dues" while he waited for that executive job?

I think if you take a look a the big picture an exec does effect the lives of others. Because they have the "authority" to run the company they way they want (to a certain degree). A pilot is responsible for their ship, etc. (which if something bad happens could effect the entire company). The exec is responsible for the entire organization so therefore they do effect the lives of others good or bad - and recently mostly bad! An exec's decision impacts the employees, the vendors/people who do business with them, and the customers. Unfortunately, I think the execs lose sight of this and focus on "shareholder" value and Wall Street instead.

 

[castle bravo]

So our tax dollars are supposed to "prop-up" unprofitable business? Thats what regulation was,,,,NO THANKS!

Edit: ps: I have a hard enough time swallowing that I am now going to pay for some United guys pension.

Just take a close look at AMTRAK!!!

 

[castle bravo]

I dont know if you you dropped out of high school but the only thing we support in the US is the dairy farmer. Its called CAPITALISM,,,jeez read a book. What you speak of would be a form of SOCIALISM. not good

Take yet another look at AMTRAK!!!!

 

[castle bravo]

I think if you take a look a the big picture an exec does effect the lives of others. Because they have the "authority" to run the company they way they want (to a certain degree).


John Dasburg had the "authority to run" right to Burger King's open arms.
Richard Anderson had the "authority to run" right to United Health Care. When the going gets rough, management "runs" all right......

 

[Yank McCobb]

LOL,,.

Yep...I'm LOL

At a jacka$$ who works for one of the extreme bottom feeders in YIP.

Who cares what you think. It's obvious WHY you think the way you do. Everyone here should just let you go on your merry way. You are what you are and you think what you think and noone gives a crap.

So keep those auto parts moving, and keep those pilots in line. Jacka$$.

 

[Huck]

I remember when Exec Jet got 737's - they needed to hire some captains off the street until the line guys could get some time in the plane and upgrade.

So they advertised for 737 captains: $136,000 a year to start.

What is important is that Warren Buffet owned the company. I would argue that this salary was as close to a "free market" amount you could find. Imagine what they would have paid had Buffet owned 777's....

By the way, I just finished my international loft for the MD11 here at Fedex. One of 7 (that's seven) lofts I have to pass AFTER my checkride. It was Hong Kong, Subic, Beijing - headsets on, plates out, real time, and a "dummy" seatfiller captain so I had to do all the headwork. And this is just to get to IOE! "Yank and bank" my a$$....

 

[Clyde]

LOL,,,what, you dont feel that a guy should get paid $240,000 a year to work 8 days a month? If your an exec at a corp and you make 240 a year your a$$ workes 80 hours a week and you probably graduated from Harvard. Well good news,,,neither does natural economic forces. A re-alignment BACK into reality is underway for Legacy pilots as we speak. Your comment is probably gonna get ya blasted by some crusty, clockin a quarter mil, but livin off 30k of it because of the train reck a career in this industry leaves behind. I mean come on guys a quarter mil to yank and bank? We're not brain surgeons. If you need proof just read any thread in here.

$240K/yr and only working 8 days a month? Wow, where can I find a job like that? Last year, I worked an average of 16 days a month and only brought home $105K.

I'm glad you protest making so much and flying so little, someone needs to fly the trash out of KYIP and you sound like the ideal person to do it. Besides, we want pilots who are going to raise the bar, not lower it.

Think about that as you fly your Part 91 deadhead back to KYIP after being on duty for 14 hours and awake for 30+ hours.

 

[Mr Zog]

I dont know if you you dropped out of high school but the only thing we support in the US is the dairy farmer. Its called CAPITALISM,,,jeez read a book. What you speak of would be a form of SOCIALISM. not good

How does regulation equate to Socialism? I am not saying go back to the 70's, but there has to be some kind of medium. The airline industry abroad is heavily subsidized. How can US carriers compete? Answer, they can't. Capitalism only works in an environment free of barriers. That is not the case in the airline industry. If we let the airlines "evolve" the way you like and remove all regulations (allowing a true free market), in 10-15 years we all will be flying Air China or Korean Airlines from ABQ to BNA. In fact, last week the Fed appeared before Congress on the ongoing currency situation in China. The government of China is arbitraily devaluing their currency to help their economy and giving them an unfair advantage in trade. This is the type of market we (the airline industry) cannot compete in.

Oh, and by the way. I was a double major in college, not that it matters. And one of the majors was Economics. In fact, you helped pay for my education. So, belated thanks.

 

[Freight Dog]

The fundamental problem in our industry is the lack of accountability.

You have CEO's and upper management running off with $$$$$ while employee groups take paycuts, lose retirement, etc.

Sorry, but there should be NO bonuses for the management unless the airline posts a profit. As long as the unions give in to the b.s. of 'saving the airline' by taking paycuts, this downward spiral will continue. The issue is not the employees, it's the corporate America rejects running our airlines coupled with unwillingness of the employee groups to call the management bluff and dare them to shut down.

 

[TAZ MAN]

The bottom line is there is too much competition. Too many seats on too many carriers not charging enough. The LCC's for now are doing there own thing in their own markets with a few exceptions. Sort of like how regulation was. Now you have the legacies competing with each other. If one doesn't go along with a hike in fares then no one raises prices. What other industry doesn't raise their prices when their cost of supplies go up. When concrete goes up, my contractor charges me more. Always. Peculiar how we don't charge more when oil rises. It wouldn't be a load of money. Probably 10 bucks a passenger. But with all this competition its that narrow. Really insane.

The only way for this to work its way out is to consolidate or let a few go out of business. It really is that simple. I vote for consolidation. But no matter which way it goes, more jobs will be lost for a while. Deregulation will only succeed with a few legacies. If all the pilots worked for free, the business still wouldn't have made a profit.

Some of the management is bad, but some is ok and they are still losing their asses.

Good luck to us all.

 

[pipejockey]

The bottom line is there is too much competition. Too many seats on too many carriers not charging enough.

I agree with the "not charging enough". But I don't understand all these people saying there are too many seats, meaning excess capacity. Load factors are at record breaking levels. I remember flying in 2000, and 2001 and I would often have an empty seat beside me. Forget it now! If the airlines can't make any money with the overwhelming demand we are seeing these days, they will never turn a profit until oil hits 30 a barrel or everyone works for free. And as far as I'm concerned we are all but working for free compared to what we should be earning.

 

[TAZ MAN]

I agree with the "not charging enough". But I don't understand all these people saying there are too many seats, meaning excess capacity.

Supply and demand. If too much supply, create the demand. Create the demand by offering lower priced seats. I worked for an airline one time that sold the entire seating capacity for a summer at half price. Completely filled the airline but went bankrupt in June of THAT summer. If they didn't sell the seats for that price they would have gone bankrupt sooner.

The problem with the legacies is that if they get any smaller with such extreme competition they will not be able to compete as much. They wouldn't have as many markets to offer and may not be appealing to the frequent flyer who is their bread and butter.

Consolidation is the key. It would provide fewer competition but hold onto market share. The problem is that any two airlines that marry will have some overlapping in their routes and will need fewer airplanes and employees. AWA and USair for example. they make the announcement and almost in the same breath say there are 50 more airplanes than they need.

Or have a United, Delta, NWA or of the like go under you will have a few hundred airplanes worth of routes reduced from capacity. No matter how its done...its the only long term fix in the industry. Sad but true.

Again, I think the likelihood is consolidation. Nationally its far more accepting to stomach. If this USair/AWA has any legs to it, you will see more consolidation to come. Delta and NWA would be a great merger for the passenger. But any merger is tough on its employees.

Good luck to us all.