Originally Posted by
zoooropa
Respectfully, your don't have a clue. They are literally changing the operation as we speak. Some small changes, like seats and connectivity, some large changes, like the entire revenue/ticketing model. Does F9 need a radical leadership overhaul? Yes, but that isn't the point here. F9 realized the a la carte process was not only generating less revenue but it was driving pax away. Instead of relying on 50% of total revenue coming from ancillary fees paid a percentage of the passengers they have pivoted to raising tickets prices a small amount paid by 100% of the pax. It hasn't fully developed yet, and it will take time. One of the largest new revenue streams will come from CC partnerships. Once the passenger base is trained and understands they can get a free checked bag as long as they buy their ticket with a specific CC (and they avoid the ghetto gate agent battle royal, win/win) we can finally become relevant with a better bank and share in some of the CC revenue. That is just one facet/component of the transformation F9 is currently going through. The route structure will also evolve for the better. Instead of reducing stage length intentionally (when you need ancillary rev to survive, you need to fly more shorter legs and turn the ac more often). Some of our most profitable legs are almost 2000nm but F9 was forced to average stage length across the fleet below 900 when we were slaves to the ancillary model.
its a work in progress, but if anyone shows me past margins and claims "they can't afford 35% raises" I'll punch them in face. Do hourly rates go down when fuel prices rise? Do they go up when fuel prices drop? Pilot pay makes up 5-10% casm depending on the airline. At F9 it is a very low single digit percentage. I don't have to work the math for you, but when you increase a SMALLER number by 35-50% it isn't going to move that CASM needle as much. Every airline gapped up during their last section 6, we missed a complete cycle. Frankly a 35% raise isn't going to cut it for me.
F9 wants a 40% cost advantage. F9 runs a stage-length adjusted CASM ex of around 6.4 and delta runs a casm ex of around 14.4. Assuming pilot wages and benefits make up 10% of casm (they don't) but worst cast thats 65 cents today plus another 33 cents with a 50% raise (not going to get a 50% raise, just keeping the math easy) we impact casm by a dollar. With a 7.4 casm we are still 48% lower than dal casm. Voilia, there is your 40% margin, FUPM.
Very encouraging and as someone slightly interested in only mildly reading about/keeping up with airline business and economics, fascinating. You raise some very interesting points. I'd like to believe this leadership can right the ship, but I think I've already lost hope.
Does any of this translate to ditching the out-and-back model? lol, many pilots are hoping yes.
Originally Posted by
AutoBrksMedium
Show me a ULCC that has legacy pay and I’ll let you try and punch me in the face.
Sir, you are rapidly losing any and all good will you might have had by being an obnoxious troll about this.
We absolutely DESERVE legacy rates, and before someone tries to point out my above post as saying we don't, I'm not saying that at all. I'm merely saying we should not give up a single work rule for pay. Absolute non-starter. A 35% raise with added work rules is a win, not a loss - but I think we deserve legacy rates, wholeheartedly.
I also think we need massive reserve rules upgrades.