What's really wrong with the US airline industry
Posted by
George on Sunday, August 17, 2008
I stumbled across this article on Forbes.com opining that what the airlines want from Washington is for the government to magically lower fuel prices. As if. But what was really interesting about this piece was a comment (the only comment when I checked) from a certain Bob Crandall, the former CEO of American Airlines. Bob is a pretty smart fellow, so I'm going to copy and paste his comment in full here (oh, and don't you just love the dig aimed at Southwest, his longtime nemesis? LOL! But he's probably spot on):
"With all due respect, you're wrong that the single biggest issue facing airlines is fuel. While it's certainly important, the airlines would take a revamped and modernized air traffic control system over any intervention in the free market price of oil. You gave that issue one sentence in your piece and I suppose that's because oil is the sexy issue du jour. But ATC is where the real problems lie.
One other correction. You called Southwest an airline. Southwest is a profitable fuel speculation company that runs a money-losing airline on the side.... remove the 474 million they got from fuel hedging in 2Q08 and the reported 321 million profit, which is only (sic) 121 million after special items, becomes a loss.
They're not making it in airline operations and they are not improving their operation as quickly or materially as other carriers."
Well said, Bob! And where are all those airfare taxes going? I thought they were supposed to go into a trust fund to improve the airport and air traffic systems in this country? Probably being used to make the deficit look better instead.
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Reader Comments
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If they'd drop the effin' taxes on these flights things could move again.. It's robbery-the taxes and fees cost more than the airfare. There's something wrong with this people! And what politician steps in and does anything about it? NONE. Why? They're all probably getting kick backs while we get kicked in the teeth. I'm sick of it!
by rick on
Tuesday, August 19, 2008
Managing your fuel costs are part of operating an airline....maybe if the other carriers managed the whole business they too could make money. Bob's just bitter!!!!
by Jim on
Wednesday, August 20, 2008
What the govt should do, is not let an airline come in and cherry pick the most lucrative routes. The major airlines all have feeder routes bringing people to major airports. It should be mandatory that a certain percentage of flights (any airline doing business in mainly in the U.S. (domestic and caribbean flights.) should be to and from smaller airports, just like the mainline line airlines do. That would level out the field and help the flying consumers.
by Donna on
Thursday, August 21, 2008
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