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Crosscheck: Restructuring the Airline Industry

Thursday, January 05, 2012

Jad Mouawad, airline correspondent for The New York Times, kicks off the January series on flying and the airline industry with a discussion on how the industry has restructured over the past decade.

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Jad Mouawad
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Comments [13]

Ed from Sparta NJ

regarding another posters' comment: Travel benefits for the airline employee have also changed radically in the last decade. "Non-revs" as we are called when using our benefits board LAST, after every paying passenger, including standbys. What's left? Maybe a middle seat, but often NO seat. Forget about traveling around holidays or during popular times. Also, contrary to what the poster said, there is an imputed tax value to the benefit which we pay taxes on. So it's not exactly "free". Getting stuck somewhere for one night and having to pay a hotel bill pretty much negates any travel "benefit", so many of us end up buying tickets just like everyone else.

Jan. 05 2012 11:13 AM
cwebba1 from Astoria

I flew American Airlines for xmas. When I called to change my seat they offered to change it for $25, or I was told to do it for free at the desk. American Airlines was selling sandwiches for $6 on the flight, but they offered them for free for "men in uniform". These types of revenue tactics exemplify bad branding policies because they are anti-social. Charging for sandwiches in-flight as a break-out fee creates resentments between people with different economic circumstance. The experience is ultimately associated with the airline. Aren't we all on this flight together? Why am I paying for uniformed military personnel to get a free sandwich when I don't get one? I did not agree to that. I'm glad that they got theirs. I resent that I was not given mine. I want free peanuts too.

The bad branding experience with American Airlines has lessons for those who advocate "Privatizing" social entitlements like medicaid or social security.

Jan. 05 2012 11:09 AM
Ed from Sparta NJ

How has the job changed? I'm a captain at the "new United" and have been in the industry for almost thirty years. The changes have been consistently negative. Increasing regulatory burdens, intrusive TSA inspections every time you go to work, more second guessing of your every move by managerial staff, random drug and alcohol testing etc etc. I have not had a pay raise in over ten years, my retirement benefit is frozen and will be half of what it was projected to be when I started my career. I am lucky that I can retire soon. Those pilots who are 30 or 40 are getting desperate for a career that compensates them appropriately for what we and our families have to sacrifice to do this job. Who will be the pilots of the future? The best and the brightest will go elsewhere, and just like the cruise industry, all of the staff will be foreign nationals or people who could not get a better job.

Jan. 05 2012 11:07 AM
Inquisigal from Brooklyn

I wish airlines would just raise prices of tickets and fold the food and baggage costs back into the ticket price. It would actually make people LESS angry, because the "deal" one thinks they get when they purchase a ticket ends up not being a deal when 3 bags have to get checked, and you then end up having to check your carry-on because all of your toothpaste and haircare products are stored there and will be thrown out at security.
If we just paid one ticket price, we'll get what we pay for and not feel put upon later.

That said, I'm actually tired of listening to my fellow entitled Americans complain about the cost of flying. It used to be a privilege to fly, and like it or not, flying costs more because it involves more. Considering the equipment, experienced people-power, and safety requirements needed for commercial airlines, I think we should all be willing to pay more to ensure the quality continues.

Jan. 05 2012 11:06 AM
Adam

I would like you to address the issue of items being stolen from luggage as it goes through airport security. I have a colleague who travels regularly from California to New York with computer equipment. He consistently has items removed from his luggage as it goes through security. We are not permitted to put locks on our luggage and we have no course of action to take when items go missing.

Jan. 05 2012 11:04 AM
James from Nyack

As a pilot for AA for 20 years, the job has not changed. Pilots still fly the planes. That aspect of the job is the same.

What has changed is:

Security. The captain is in charge inflight security.

FDO's...Federal flight deck officers. These are armed pilots. Zero pay for the Federal officers. These pilots take on the responsibility of carrying a loaded weapon to protect the cockpit and get no additional pay. Who else carries a gun for no compensation?

Pay. 1992 pay rates in 2012. And now with AA in bankruptcy, pensions are at risk.

Commuter airlines....massive expansion of the commuters. Often operated by pilots making very low salaries(and often have little experience) but tickets are sold to the passenger as a code share flight and the customer thinks they are getting a flight( and safety) of the mainline airline.

I could go on and on......

Jan. 05 2012 10:58 AM
Mark Elijah Rosenberg

On NPR's Planet Money podcast, there was an interesting piece about how airlines make a lot of money from investing in oil, hedging their fuel costs and then re-selling it later.

Jan. 05 2012 10:58 AM
RJ from Prospect Hts

The phrase "legacy cost" has become a derogatory shorthand for benefits such as pensions that are negotiated as part of a package in which current benefits are exchanged for future ones. So if I buy a shirt today on sale, should I have to pay back the discount a few years from now? The industries should be using the money saved in the present in ways that either raise new revenues or earn interest from either savings or investments. Why are companies allowed to break legally binding contracts?

Jan. 05 2012 10:57 AM
Melody from nyc

Recent discussion of the airline industry on Planet Money.

http://www.npr.org/blogs/money/2011/12/16/143765367/why-airlines-keep-going-bankrupt

Also, I sat next to a flight attendant (23 yr veteran) on a recent flight. She said the airlines lost a lot of revenue from cargo fees, specifically the US postal service. People aren't sending letters.. airlines make a bulk of their money from hauling cargo. Also, she said after 23 yrs. her pension has been completely taken away, and makes no overtime fees.

Jan. 05 2012 10:54 AM
Richard Johnston from Manhattan upper west side

The enormous benefit airline employees have in being able to fly for little or no money is not counted as income, just as premiums on health insurance paid by employers are not taxable.

Jan. 05 2012 10:54 AM
Leftist from Montreal CANADA

Simple reason why baggage fees: they are NOT NOT NOT subject to federal ticket taxes. The airline & govt cannot force you to bring a bag to fly so they are mandatory and if fee is optional, not part of ticket price & thus NOT TAXABLE. tricky eh?

Jan. 05 2012 10:53 AM
Sheldon from Brooklyn

It has to do with deregulation and the subsequent race to the bottom.

Americans, simply want to pay Walmart prices but expect to get the Bloomingdales' style service.

Jan. 05 2012 10:51 AM
RJ from prospect hts

Please comment on the problems caused by the hub system. And the pressures on staff (i.e., sleepy pilots) by the mergers and consolidations.

Jan. 05 2012 10:50 AM

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