Originally Posted by
UALinIAH
Our formula is not better. In fact as we grow and add to the expense line we fall further behind. Our 2022 expense were $42,618 Million as recently reported. In order to have 6.9% profit margins we would have had to make $2.9 billion in profit. So that’s an extra $400 million that DAL gets 20% of that we don’t. As expenses go up with new aircraft and more employees, it takes even more profit to hit the 6.9% and we fall further behind. It’s simple economics of scale. The company knew this years ago and we fell for it. Another classic example of Checkers vs Chess.
I believe our expenses this year were abnormally high due to debt, excess training, building at tk and new ord ops center and aircraft purchases but they should fall. Normally we are in the 2.3-2.7B to make the 6.9% cutoff. Delta has a hard dollar cap of 2.5B for the 10%-20% limit (for those that don't know.) My point was that the problem isn't the formula as they are virtually identical. They just produce more profits than we can currently.