Originally Posted by
eaglefly
Bucking, while there's no way mainline labor COSTS could match that of Go Jets, one question is to ask is could that be negated by a REVENUE increase to DELTA. To outsource that flying, Delta must relinquish some of the revenue to another operator that would have normally gone to them in order for that operator to make their own profit.
Depending on the circumstances, it might be possible for mainlines to recapture SOME flying like that and break even as opposed to outsourcing.
And even that falls a little short. We don't have to match or beat bottom feeder bock hour rates just accounting for the money spend subsidizing their margins or overhead. All we have to do is be able to operate that flying, with total costs apread out and amortized throughout the entire operation, so that the whole operation is run well and profitably.
That said, we absolutely get full and complete "barganing credit" for the many, many, many billions of dollars wasted on DCI outsourcing blunders to apply to our cost side of the equation. To not do so would be incredibly intellectually disingenuous.
But what fun would that be. Let's hit the links, fire up the stogies, swirl some brandy and chortle at our block hour savings bonuses, fellow B school geniuses! Weeeeeeeeeeeeeeeeeeeeee!
