You Ain’t Seen Nothin Yet

This week ATA Airlines, Aloha Airlines, and Skybus Airlines ceased operations. 

If this doesn’t seem like a big deal just wait. The airline industry as we understand it today is melting away faster than the Antarctica ice.

Fares are cheap. Planes are full. Fuel is expensive.

Most airline companies will fail financially and cease operations. Pilots at United, Delta, American, and others have taken HUGE pay cuts, lost thier pensions and are still suffering the stress of lost job security. How can this be a good thing?

Pilots at Southwest were the lowest paid five years ago and never had a pension to start with. They do seem to have job security though.

Historically when times get tough airline management comes to the pilot group for concessions. The idea is that after a while things will get better and we can all share in the rewards. It hasn’t worked yet.

If the pilots had never agreed to pay concessions the industry would have had a total crisis about six years ago, twelve years ago, in the early nineties, mid eighties and several others. This seems to have happened about every six or eight years since 1930, and it has been much worse since de-regulation.

After the big industry “crash” there will be thousands of airliners parked in the desert with foil on the windows. General electric, American Express Credit, Guiness, and a host of others that hold the financial paper on the airframes and engines will suffer.

Maybe they can get a few billion from Congress and make it all better.

We are rapidly headed for a Re-Regulated airline industry, or a Domestic System with only one carrier, maybe two.  You’ll pay for it one way or the other.

Please check your seat belt, this will be a wild ride.

Happy Landings


One Response to “You Ain’t Seen Nothin Yet”

  1. I think the problem of the industry is actually very simple: delays. No one wants to fly because of the inevitable delays.

    I know a number of people who were planning on flying somewhere (short trips, not cross country), but after calculating everything including delays and security checks, it actually takes less time to drive!

    If this continues soon airplane service will only be for long distance flights.

    They have to get rid of delays! And slow security checks don’t help either.

    People fly for just one reason: it’s faster than driving, or a bus. Make it slower and no one flies.

    Pass a law requiring compensation as $20 per hour for delays for any reason and watch the industry do much better.

    If there is a weather delay no compensation during the bad weather, but as soon as it’s over they had better be ready to fly – no overbooked flights and standby issues, while blaming weather.

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