Originally Posted by
Excargodog
I’ll concede that I wasn’t thinking SWA, more JB, Spirit, Frontier, and soon to be Moxy-whatever.
But my point was that the new (and newly expanding) airlines do CURRENTLY enjoy an advantage and that while yes, they have some junior people on board, as the upcoming retirement wave demonstrates, they’ve had a lot of pilots that have been in the top of the payscales for a long long time. And yeah, 50% was undoubtedly a little hyperbole.
Not criticizing anyone, just looking at the demographics and the resulting economics. And ten years from now most of the legacies will have a far less senior demographic, precisely because of those retirees. Read a business article a few years ago about the effect of the increase in retirement age from 60 to 65. One of the things it did was rather dramatically increase the average longevity (and hence the average personnel costs) since almost all those retained were super senior.
The savings in training costs by having people work five years longer were a blip compared to the increase in personnel costs that the increased seniority cost.
The accountants at management no doubt read the same article. Which is why, I believe, they are just as happy to keep flows and preference programs as slow as they believe they can. Your opinion may vary....
No big deal, it’s pretty common for people to lump SWA with the Legacies and JB with the ULCC. But I’d say, between the two of them, they are the only true LCC in the US (even though Delta is probably the only airline that consistently comes close to matching the product at JetBlue). Neither is a legacy or an ULCC.
JB was lagging while waiting on a contract but now that one is in place the payscale and retirements are identical to SWA and about 3-5% behind the legacies operating the same equipment. We will be continuing to work to close that small gap that the legacies currently have on us.