Originally Posted by
Sunvox
Here are the basic expense statements from the 2017 annual reports. Notice salaries and rents/fees. (Delta is in blue.) Assuming for the moment the two companies are accounting for the same item in the same way, it looks to me like we have over a $1 billion dollar structural difference in expense that we will never overcome.
Interesting to note that the two companies account for regional partner costs in different ways making honest comparison difficult.
FWIW, DAL “outsources” (cough) to DGS, a wholly owned subsidiary, nearly all labor costs except for pilots, mechs, and FAs. It takes those labor expenses out of one column and places them in another.
Since DGS is non-union with lots of part-time employees DAL enjoys a labor cost advantage, but it’s not as significant as a first glance at “labor costs” might initially suggest.