cactusmike

Sorry, dude you've got the pay thing wrong. AirTran pays more than most mainline carriers.

Just paying low salaries doesn't make you profitable. The question should be what is the productivity. A productive pilot group will have less of an impact on CASM than an unproductive pilot group even if the higher prod group is paid more.

Airlines like America West subsidised poor management by low wages for years. That subsidy is now over. The rest of the industry has sunk to our level. Now management has to actually become creative or the airline will fail.
With everyone on the same cost basis the success of an airline will be determined by the ability to attract and retain passengers or freight.

ryane946

Max captain pay (Low cost versus legacy)

AirTran = $153

American = $196
United = $189
Delta = $186
Continental = $186

P.S. I agree that productivity is a huge factor. To lower your bottom line, you either decrease pay, or increase productivity. I kind of considered them one in the same in my above post.

banger

You really don't know what went on at Delta, first the FA weren't union. The pilots were. The company could unilaterly cut the FA's salary without even asking. The pilots had a contract and cutting the pay is not something they could do without declaring BK. Which they eventually did.

Daytripper

1. One of Song's problems was the 757. The 757 is a great aircraft, and it is considered the most fuel efficient single aisle airplane (By % of seats filled). The problem with that is it was competing with A320's with over 40 fewer seats.

Ah, so you gotta use an airplane with less seats than your competitor. Now I get it. Got nothing to do with CASM, RASM, stage length, etc.

When Shuttle By United was profitable...

I'm a little fuzzy on that one too. When was that???

ryane946

Hahaha!!! I know you did not mean to do it, but you answered your question in the line above. That's pretty funny. A United 737-300 with 8 first class seats and 114 coach seats is taken and retrofitted. One bathroom and the galley are taken out (Since the plane doesn't fly more than 3 hours (and 2 hours for Shuttle)), and now there are 126 seats in coach.
Adding more seats on the same plane lowers CASM.
So does cutting pilot pay.

People think of Shuttle as a kind of LCC. Sure it was low cost in terms of costing the airline, but the seats were not cheaper. The strategy behind Shuttle was more seats, lower pilot pay, and high frequency. Low cost tickets were not part of the package. Trust me, I know.

So lets take the period from 1994-1998 when United was PROFITABLE.
How could Shuttle not be profitable, if the entire airline was profitable, and Shuttle had much lower CASM and similar RASM.

Daytripper

I didn't answer my own question. I asked you to tell me when Shuttle by United was profitable. You stated United was profitable from '94 to '98. That in no way means that all divisions within an airline are profitable. In fact, has there ever been an airline....within an airline that was profitable??
Most Legacy carriers have written off domestic flying as unprofitable, turning growth toward international flying. Shuttle was a response to LUV poaching west coast traffic with low fares. UAL matched those fares to keep from losing market share. They made attempts to match cost......as did Metrojet, Song, Cal Light, but it still fell under the corporate umbrella of a higher cost, full service carrier. Passengers had no clue what to expect.
Case in point. Jet Blue started service in EWR to Fla and San Juan. Continental had anticipated this and bought aircraft that would allow them to match fares without taking a beating on the cost side. They don't anticipate a profit on that flying.....they will retain market share. That aircraft is a Boeing 757-300. It has MORE seats than the Airbus, but not proportionally more cost to operate. The crew does not get paid less to work them. One last tidbit I'll throw out. The USAir lesson. Cut the crew pay to reduce cost......service levels go down. Revenue drops due to passengers booking away. Need to reduce cost again. Workers hacked off even more. Offer poor service. Passengers leave in droves. Revenue falls more. Need to cut pensions and benefits. Workers can now make more outside the industry. Management jumps ship....BOD brings in Bankruptcy Lawyers.
That's it. Too bored to continue.....