Support for other pilots and Simple Math

[Dan Roman]

By making this statement that supply essentially exceeds demand, you acknowledge that the next round of LCC entrants will quickly emerge with pilots flying retired busses and madogs and guppies for sub RJ wages funded by anyone with a full bank account (GE capital.).

I don't think it will be that widespread, just starting an airline with cheap labor doesn't guaranty success. Far from it, for every SWA there is a dozen PeopleExpress's. Virgin isn't putting pressure on anyone with low wages, if anything they and JetBlue seem to be focusing on upping the service level . I'm an optimist, but I think the airline industry is consolidating and getting healthier than it ever has (which supports Beechs premise). The supply and demand part of the equation comes in with the regional pilots. They are the one's that need the most support for bringing up their wages. I'm guessing the airlines remaining all have a much stronger foothold than they ever have had and don't need to fight over who has the cheapest labor as much as in the past. It's no longer a matter of survival for anyone remaining. Airline pilot wages may have bottomed out as their is no way anyone would consider trying to replace a pilot group (strike) with cheaper labor. It is no longer even remotely feasable.

 

[scoreboardII]

They don't have too, they have us right were they want us, they lowered the bar via regional feed and wipsaw of wage between the RJ/mainline fleets and now have bottomed out the payscale to that of the RJ.

SWA pilots get paid what they made in 1973, adjusted for inflation.

The rest of the industry has collpasped below that level.

You might be right about stability, but wages will remain stagnant.

Unfortunately.

 

[Andy]

and we could raise the requirements to get an ATP to an ACT score of 29, about the same for academy admission. That would certainly cut down the ATP numbers.

While I wouldn't use ACT scores, I'd tighten up ATP requirements to be more like the MCATs. In countries where there aren't extremely high hurdles to becoming a doctor, doctors' wages are lower than in the US. US doctors have artificially reduced the number of doctors by making entry qualifications so high that only a few qualify.
Do the same with pilots and you will resolve most pilot wage issues.

 

[Andy]

By making this statement that supply essentially exceeds demand, you acknowledge that the next round of LCC entrants will quickly emerge with pilots flying retired busses and madogs and guppies for sub RJ wages funded by anyone with a full bank account (GE capital.).

The barriers to entry are near zero to start up a new airline. If it weren't for worldwide liquidity constraints, we probably would have seen one or two startups since age 65 went into effect. And it's not just old aircraft that you'd see startups fly; aircraft manufacturers are very generous with financing new aircraft.

 

[Andy]

Yet they line up around the corner to buy a frappecino whatever with whip cream from Starbucks for $4.

I'm done believing that bs from managment.

Starbucks has successfully branded their coffee. Coffee is a commodity that is offered everywhere, but they have somehow captured a large market share for a product with near zero difference between their coffee and the coffee sold by Dunkin Donuts/McDonalds/Burger King/etc.

The only similar business model that I see in the airline industry is Southwest where they have a very loyal consumer base. To a lesser extent, all of the major airlines have frequent flyer programs that allow them to have loyalty from a small percentage of the flying public.

If you can figure out a way to get the flying public to pay an extra $20 per ticket for a unique flying experience that can't be easily duplicated by other airlines, you'd see the Starbucks effect in the airline industry.

The internet has absolutely destroyed the airline industry. It allows the public to shop thousands of airfares with a couple of keystrokes. With very little to distinguish American from Delta from United, the key variable is ticket price.
That's forced airlines to cut corners in every aspect of the operation in order to lower ticket prices. You used to get free alcohol in coach (long ago). You used to get meals in coach. Now you can't even get a free bag of pretzels/peanuts on most airlines. Airlines have been forced to cut wages in order to remain competitive and I would expect pilot wages to continue downward until demand exceeds supply ... we have a long way to go until that happens.

 

[scoreboardII]

The barriers to entry are near zero to start up a new airline. If it weren't for worldwide liquidity constraints, we probably would have seen one or two startups since age 65 went into effect. And it's not just old aircraft that you'd see startups fly; aircraft manufacturers are very generous with financing new aircraft.

Andy gets it.

Expect to see numerous startups next year or at least once the presidential election is defined.

Then, the new paradigm evolves, pilots flying mainline for RJ wages competing against current LCC's. LCC (like SWA) who have a wage disadvantage of 50%.

All that money thats being pulled out of the airlines via consolidation and bankruptcy will go right back in when the next IPO for "We fly cheap express" hits the streets.

 

[scoreboardII]

Starbucks has successfully branded their coffee. Coffee is a commodity that is offered everywhere, but they have somehow captured a large market share for a product with near zero difference between their coffee and the coffee sold by Dunkin Donuts/McDonalds/Burger King/etc.

The only similar business model that I see in the airline industry is Southwest where they have a very loyal consumer base. To a lesser extent, all of the major airlines have frequent flyer programs that allow them to have loyalty from a small percentage of the flying public.

If you can figure out a way to get the flying public to pay an extra $20 per ticket for a unique flying experience that can't be easily duplicated by other airlines, you'd see the Starbucks effect in the airline industry.

The internet has absolutely destroyed the airline industry. It allows the public to shop thousands of airfares with a couple of keystrokes. With very little to distinguish American from Delta from United, the key variable is ticket price.
That's forced airlines to cut corners in every aspect of the operation in order to lower ticket prices. You used to get free alcohol in coach (long ago). You used to get meals in coach. Now you can't even get a free bag of pretzels/peanuts on most airlines. Airlines have been forced to cut wages in order to remain competitive and I would expect pilot wages to continue downward until demand exceeds supply ... we have a long way to go until that happens.

Agreed in whole.

 

[pilotyip]

Andy gets it.
Expect to see numerous startups next year or at least once the presidential election is defined.
Then, the new paradigm evolves, pilots flying mainline for RJ wages competing against current LCC's. LCC (like SWA) who have a wage disadvantage of 50%.
All that money thats being pulled out of the airlines via consolidation and bankruptcy will go right back in when the next IPO for "We fly cheap express" hits the streets.

Agreed in whole.

and your fix for this is what?

BTW Starbucks is under economic pressure to cut costs, close stores, looking at part time help with no benefits. People are not buying as much $4.00 coffee, when Meijers Gas Station sells it for $1.00

 

[ultrarunner]

[/QUOTE]Originally Posted by scoreboardII
Andy gets it.
Expect to see numerous startups next year or at least once the presidential election is defined.
Then, the new paradigm evolves, pilots flying mainline for RJ wages competing against current LCC's. LCC (like SWA) who have a wage disadvantage of 50%.
All that money thats being pulled out of the airlines via consolidation and bankruptcy will go right back in when the next IPO for "We fly cheap express" hits the streets.[/QUOTE]

and your fix for this is what?

Denying the application for an operating certificate on the grounds of "enough capacity".

I vote for re-regulation! Think about it, who wasn't happy during airline regulation?

 

[GogglesPisano]

I vote for re-regulation! Think about it, who wasn't happy during airline regulation?

Alfred Kahn. And Yip, apparently.