Do you really not get his point? People are willing to pay a premium for a premium service. Someone sets the standard, while others are cheap imitations. Just ask Rolex how that has worked out for them. On another note, a thirty percent increase in pilot salaries does not equate to a thirty percent increase in expenses. Netjets will continue to be a healthy profitable company. The question is how much money goes to Warren's shareholders and how much goes into the pockets of the workers. That percentage split favors the shareholders every year that the workers are locked into 2007 rates. It is time for a reset to fairness and a more equitable split.
This is exactly right!
For example, I think I heard pilot compensation makes up 5% of the company's expenses. Okay, so if you doubled pilot compensation, which is a 100% increase to pilot salaries, you've made pilot compensation something closer to 10% of company expenses. It's not a 100% increase in operating expenses for the company by any stretch of the imagination.
I'm not saying we'll get that, just using it as an example. If we got a 50% increase in compensation, our share of company operating expenses goes from 5% to 7.5%.
Yeah, that may cut into company profitability a little, but it's not the end of Netjets.
And they could easily pass those increases along to our clients to cover it. We're not about huge increases here (for the clients). For those worried about what the clients will pay, well, they're ALREADY paying significantly more to be with Netjets over anyone else. Something along the lines of 35% more, and they're still buying. If we ended up being 36% or 37% more, I just don't see a mass exodus of the wealthy from Netjets.
As others (and myself) have mentioned, if they do leave, it isn't because the pilots are making more. It's because they aren't getting what they were promised, and that is not the union's fault. If the end is coming for Netjets, I'd rather get a sizable increase in pay now so i can save more money for when it happens, than go out with less. If the company is doomed by the small increase in cost it would take to cover a large increase in pay for us, then it was doomed anyway.