If Airlines Are That Unprofitable, It's Time For A New Model

If airlines are so unprofitable, it's time for a new business model. For openers, ditch the unions. There's the pilot's union, the flight attendant's union, the mechanic's union, the baggage handler's union, and who knows what else. There's most of your huge costs right there.

Then decide what your mission is. Is it to provide safe comfortable transportation by air from point to point - or is it to make the passengers sorry they ever booked your carrier but had no other choice, and they got nickled and dimed all the way? I'm thinking the latter is closer to the point.

Thursday, American Airlines announced that they are going to be charging $50 for anyone "wanting" to fly standby - regardless of whether you get to or not and another $8 for a pillow and blanket. That last one makes sense. The cabins are so comfortable anyway - why would you need them?

USAir tried charging $2.50 for a little glass of soda but soon found out that didn't work and went back to free.

Ask most anyone if they like to fly, and the answer will be "no." Factor in the TSA screening for an extra hour, being herded like cattle onto the plane, sitting elbow-to-elbow with someone you've never met before, paying $20 or more just to check a bag (what else are they going to do with the belly of the plane anyway?), paying $100 or more if you have to change your flight, sitting on the tarmac or taxiway for several hours, and on and on.

I'm all for free enterprise. Charging a captive audience for pillows, sodas, blankets, and luggage is not free enterprise. It is manipulation.

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Comments

Steve:

Our airline industry does need a complete overhaul.  The system is very broken.  They need to find a long term solution to their profitability issue and implement it.  There shot guy approach with new fees every time the consumer turns around is not sitting well with any of us.

Posted by Christine Stalsonburg Your Traverse City Michigan Realtor (Re/Max Bayshore Properties) over 2 years ago

They definitely need to come up with a new strategy.

Posted by Scott Gephart CRS - Medford Real Estate (The Atlas Group) over 2 years ago

I remember when flying was fun.  Now you get nickeled, dimed and violated.  For safety sake I am willing to deal will TSA and the violation part.

Posted by Jay Schmitt - Gettysburg Real Estate Agent (Prudential Bob Yost-Sites Homesale ) over 2 years ago

I think even though I am not a fan of unions per se, that when you consider climbing on a plane on the east coast...and voila, you are in Florida or LAX or where ever a matter of hours later, for under $300 that it sure beats driving, taking a train, hitch hiking. The bag charges that people really whine about...I think the lady in front of me that had four bags and nearly a ton of "stuff" probably can pay for the frieght or lighten the load. If they are not profitable, Uncle Sam can always bail them out like the banks though right? Have kids that I fly to and from DC and Colorado a lot and amazed, grateful they always get there, and their bags too. Unless weather causes a log jam.

Posted by Andrew Mooers | Northern Maine Real Estate / Aroostook County Broker (MOOERS REALTY) over 2 years ago

Every airline will do it and then the FIRST one to NOT do it will see their business increase!!!

Posted by Wallace S. Gibson CPM * LandlordWhisperer (Gibson Management Group, Ltd.) over 2 years ago

Christine,

I still go back to the unions. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Scott,

Few of them are willing to really make it work. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Jay,

I actually like flying, but as a trade-off, it the driving time is less than 6 hours, I'm probably driving. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Andrew,

My main issue is that they have gotten out of the service business. They're not even in the transportation business but rather shipping cargo (us). :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Wallace,

Agreed. What a copy-cat business. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Flying is uncomfortable so I try to keep in mind where I'm going and that usually gets me through it. There is room for improvement for sure Steve without gouging the customer!

Posted by Wanda Kubat-Nerdin, REALTOR® St. George, Utah (Prado & Kramer Real Estate, St. George, UT 435.632.9374) over 2 years ago

My husband is a pilot with a major airline. He is a member of the pilots' union. If it weren't for the pilots' union, air travel would be less safe. The union negotiates with the airlines to make sure the pilots have sufficient rest periods, that they have a clean, safe and comfortable place to sleep, get fed when they are stuck in the cockpit for X number of hours, etc. You don't want your pilot to be tired, hungry or itching bed bug bites while he's flying the plane. The flight attendents' union ensures that they get enough rest, have a clean, comfortable place to sleep and that there are enough of them on a flight to get you a soda and peanuts in a timely fashion. Its not the pilots' fault, the flight attendants fault, or the unions' fault that flying is an unpleasant experience.

The FAA dictates the minimum requirements for safety but that's all. I'm thankful for the fight the unions put forth to ensure passenger and employee safety and comfort. If it were up to the employees (most of them union members), they wouldn't have to hit you up for excess baggage fees, for a soft drink or a pillow.Think about it - their job is easier and more pleasant when they are dealing with relaxed, comfortable, well fed passengers.

Here's a video from the respected television show Frontline called Flying Cheap

I'd much rather have an experienced union pilot at the helm, like Captain Sullenburger, than an inexperienced, poorly paid, non-union pilot like the one at the helm in the Colgan Air crash. Is it really worth it to get an airline ticket for $50 less if it means your safety is at stake?

My husband earns about half of what he was earning working for the same airline in the same position (Captain) as he did prior to 9/11. He lost a big chunk of his retirement that was invested (mandatory) in company stock and he lost his pension. And no, we don't get to fly for free. The pilots and flight attendants have given up enough.

Your beef should really be with the Airlines, not the employees.

Posted by Michelle Minch Home Staging Los Angeles & Pasadena, CA (Moving Mountains Design Home Staging, Pasadena, CA) over 2 years ago

There is so much to be done and pointing fingers in ANY direction won't help. The WHOLE country needs an overhaul. Where do we start? And who will do the overhauling? So many problems and not enough answers.

Posted by Robert L. Brown~Grand Rapids Real Estate Bellabay Realty, West Michigan (www.mrbrownsellsgr.com) over 2 years ago

Wanda,

Very few companies have even tried to be profitable and reasonable. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Michelle,

Thanks for sharing that side of the story. The airlines definitely are big enough to shoulder the blame for poor management. If the unions exist for working conditions fine. Collectively, however, unions have increased the costs in all industries. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

Robert,

While I agree in principle, do not include the airlines in the government mix. Government is usually the problem and not the solution. :)

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

The whole industry doesn't need to change, but the "full-fare" lines are definately on the way out...

Posted by Lane Bailey - REALTOR & Car Guy (Century 21 Results Realty) over 2 years ago

Lane,

With the mentality of the airline industrey as it is, not sure we will see much of a change except more charges.

Steve

Posted by Steve Hoffacker - Sales Trainer/Coach, Sales Books Author, Photographer (Hoffacker Associates LLC) over 2 years ago

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