Will the Good Ole Days Ever Return?

[Melon]

I am doing the usual look-ahead that so many of us do. This has got me thinking, will the good old days, i.e. pre-9/11 ever return? We are currently at record fuel prices, only a small handful of carriers are hiring, and there are still thousands of guys on furlough. The jobs they will be recalled to are not what they used to be either in terms of schedule, compensation, etc. Will this employers market ever end? Will the majors be less selective on who they hire and will the regionals be upgrading at 6 months if you have the time?

My thoughts are no to all the above, and I am usually an optimist.

Discuss...

 

[SEVEN]

Until the airlines begin raising ticket prices at the rate of inflation or just to keep up with the current fuel prices I don't see much change either. The legacy carriers need to stick togther against the low-cost carriers and begin to pass those increased costs onto the consumer. You can only take so much from your labor groups. But until then, the regional airlines will continue to pick up more and more flying in the domestic market. NWA mainline has already made it clear that their long term goal is to focuses on international travel primarily in Asia. It's too expensive to fly a DC9 from DTW-JFK with a crew that is making over twice as muck as a regional carrier doing the same flight. I could go on and on but I'll let the next guy give his 2 cents. Peace Out!

 

[radarlove]

My thoughts are no to all the above, and I am usually an optimist.

Discuss...

Sure they will. If you've ever studied macroeconomics, you've seen the cycle effect. Everything in the economy is subject to cycles. That's why it was so funny to hear "the business cycle is dead" during the dot com boom right before the floor fell out.

Oil prices, airline boom/busts, automakers, everything goes up and down.

In the eighties, energy costs were so low that producers were going bankrupt left and right in the south. The idea that any trend is permenant is silly.

That's not to minimize the disruptions from the down cycles, they're horrible and lots of pain comes but there is inevitably an up cycle.

 

[Melon]

Radar,
I hope you are right, and typically I would agree with you. However, there seems to be a new economy. One defiant of the old standards. The RJ has also changed the business model of most of the legacy carriers. I remember just a few years ago USAir had all props, and no RJs. Look what happened to them. Then they started operating RJs and things started turning around (I know there are other variables involved). Hopefully history will repeat itself, but I am still not sold on the idea....too many things have changed and it seems as if airline brass has not made the appropriate changes to remain competitive.

 

[YourPilotFriend]

It could get better, or it could get worse. If we can find someway to control the supply of pilots, we could get those salaries back easy. For that to happen, it may have to get even darker to persuade new pilots to stay away. There are more jobs at the majors than there are jobs at the regionals, but the surplus of pilots is at the regionals to majors transition. There appears to be a shortage of qualified pilots to enter the regionals since minimums have been lowered.

However, larger planes at the regionals such as the E170 have forced minimums to go to ATP levels. But as i've said before the number one goal to get this career back is Brand Scope.

 

[PCL_128]

Sure they will. If you've ever studied macroeconomics, you've seen the cycle effect. Everything in the economy is subject to cycles. That's why it was so funny to hear "the business cycle is dead" during the dot com boom right before the floor fell out.

LOL! Exactly. My personal favorite is "paradigm shift." "It's a paradigm shift! The business will never be the same again!"

To answer the original question, yes, I do believe things will get back to normal eventually. We're seeing the signs of it already. JetBlew is about to start raising fares because their profits have turned to losses, SWA will need to start raising prices to counteract the dwindling hedges, and the majors are all at or near 75-80% load factors. Be patient. Things will get better eventually.

 

[Mamma]

JetBlew is about to start raising fares because their profits have turned to losses, SWA will need to start raising prices to counteract the dwindling hedges, and the majors are all at or near 75-80% load factors.

PCL 128,
That was so funny! I love your quick wit..."JetBlew!" Did you make that up on your own??? I mean, it is spelled "JetBlue" and sounds like "JetBlue" but you saw a different angle on it and spelled it "JetBlew!" That was so funny and intelligent! For a minute I thought you were completely unoriginal and a fraud because I figured you copied it from 32Lt10 or Dave S, but then I figured that could not be the case as you usually write such smart posts that everyone loves to read and learn from! Why are you still at a regional anyway? With smarts like yours you should be flying the whale as captain somewhere! Maybe you just need a little more experience to get there....you can do it!!! Keep up the really witty and funny posts...we are all laughing!!!

your fan,
Mamma

 

[fam62c]

It's tough to be optimistic. High fuel prices, overcapacity (too many airlines), and a surplus of pilots makes it tough. The bottom line is that the good times will never return unless the airlines can make a profit. It's simplistic to say that simply raising the ticket prices is the solution. This can only be done successfully if industry capacity is lowered to reflect the lowered demand for travel that will occur with higher prices. Somebody mentioned scope as a solution and this won't work either. You can't scope out your competitors and "protecting" high-wage positions, although a noble goal, does nothing to make profitability more likely for the carriers that are struggling.

It remains to be seen what will hapen when the reorganized legacy carriers get out of BK and start competing with each other and the discounters. I feel that the industry has too many players for everyone to stay in business and make money. Something has to give, sooner or later the creditors are going to have to cut their losses and stop bankrolling the continued operation of every company that fails. At this point about all you can do is pray for cheap fuel and an awesome general economy because that's what made the "good times" of the 1990's possible.

 

[xcr600]

JetBlew is about to start raising fares because their profits have turned to losses, SWA will need to start raising prices to counteract the dwindling hedges, and the majors are all at or near 75-80% load factors.

PCL 128,
That was so funny! I love your quick wit..."JetBlew!" Did you make that up on your own??? I mean, it is spelled "JetBlue" and sounds like "JetBlue" but you saw a different angle on it and spelled it "JetBlew!" That was so funny and intelligent! For a minute I thought you were completely unoriginal and a fraud because I figured you copied it from 32Lt10 or Dave S, but then I figured that could not be the case as you usually write such smart posts that everyone loves to read and learn from! Why are you still at a regional anyway? With smarts like yours you should be flying the whale as captain somewhere! Maybe you just need a little more experience to get there....you can do it!!! Keep up the really witty and funny posts...we are all laughing!!!

your fan,
Mamma

Go Stewie Go!

 

[Publishers]

While cyles do occur and there are constant mini cycles, oft times there is a new nomal. The good old days were rarely as good as depicted and we will not go back to regulated days which set a good many of the policies that are still lived with today.