Originally Posted by
makersmarc
Not to drive you crazy, but exactly how are the profits of the W/O carriers dispersed?
That 10% margin has to go somewhere.
Riddle Eagle has got it.
Net of expenses, that revenue is profit. Same as any other revenue the Company generates. Budgets are nice, but in this business, it's hard to keep a budget.
I recall Continental's VP of Engineering was in trouble because their "unscheduled engine removal costs" were over budget. Of course, by definition, "unscheduled" is unscheduled. As a result they had a little bow wave of FOD'd out engines they were pushing forward into future fiscal years to make Gordon Bethune happy that their unscheduled emergency engine failures were budgeted to the penny. It just goes to show how silly a budget can be when a DC-10 is parked because it's fodded out engine isn't budgeted to break until next year.
As far as the money goes the division between our divisions is more in our mind than real. Comair's strike helped pull Delta into bankruptcy while Delta's bankruptcy pulled Comair in also.