Aa Slow Death

[eolesen]

In order for collusion to exist, there must be a fraudulent or otherwise illegal purpose.

But, to agree with each other than they must stop selling tickets for less than what it costs to deliver the service (which in my estimation will ultimately jeopardize the transportation industry, ergo the nation's economy) is just good, smart business practice, not collusion.

[post="197293"][/post]​

Call it what you want, but when competitors attempt to coordinate pricing in a deregulated environment, it's illegal, therefore collusive, behavior.

Then again, I'm sure you know more about antitrust issues than the folks at the DOJ...

 

[Wretched Wrench]

Then again, I'm sure you know more about antitrust issues than the folks at the DOJ...

[post="197322"][/post]​

Be Nice, now.

 

[FWAAA]

Sfb says: "Southwest still would have been profitable, even if they hadn't hedged fuel. Their net income would have been $46 million instead of $119 million."

You are indeed correct. Not sure where I read the reference, but IIRC it was from a credible source.(It was not this quarter btw) If I can dig it up I will. Although, the point is still somewhat true, 119 vs 46. JBU was sadly not hedged as well as SWA, believe the number was 40%. As far as disruptions due to the hurricane, while true both DL,AA and SWA et al. suffered from these events and may have cancelled more flights, percentage wise I think jetblue would be right up there.

[post="197283"][/post]​

I'll bet you are thinking of the first quarter of 2004. WN would have lost money in Q1 2004 had it not been for fuel hedging gains:

http://ir.thomsonfn.com/InvestorRelations/...&storyId=111595

Fuel hedging gains of $63 million and a pre-tax net income of only $41 million (after tax net of $26 million). Take away the fuel hedging gains in Q1, and WN would have posted a loss.

 

[Dizel8]

Thanks FWAA, you are correct.

 

[JS]

Thanks for proving your own stupidity. In order for collusion to exist, there must be a fraudulent or otherwise illegal purpose. Now, if pricing one's product at a break-even price is fraudulent or illegal, then you may have a point. Now, if they decided to put a stranglehold on the market and they all price tickets at 100% profit - that would be collusion. But, to agree with each other than they must stop selling tickets for less than what it costs to deliver the service (which in my estimation will ultimately jeopardize the transportation industry, ergo the nation's economy) is just good, smart business practice, not collusion. Remember, when they did exactly that - it was called "regulation" and that which you call "collusion" was controlled by the government.

People will pay it and fly, or they won't and they'll walk. It's better to forego possible ticket sales that are being sold at an astronomical loss. Why fly a butt somewhere at a loss when not flying that butt is a savings, especially on fuel?

[post="197293"][/post]​

Airlines have been doing this for years in uncompetitive markets. The fare for flying something like AVL-MSN is effectively a monopoly price. Raise it, and total revenue on the route will drop.

The competitive routes are where airlines are "losing" money -- in quotes because it's not really a loss when you look at one ticket sale at a time (which of course is how tickets are actually sold).

That is, raise the price from $100 to $110, and you don't make an extra $10, you lose $100 (minus a few bucks saved in labor and fuel, but it's mostly a loss).

The only way to raise fares in competitive markets from $100 to $110 without losing $100 on the resulting empty seats is to convince all the other airlines to do the same. Considering the fact that LCC exist because the airlines used to charge $300, I doubt the LCC will agree to such a plan (besides the fact that it's illegal).

Furthermore, you say that people will pay a fare increase no matter what. What kind of world do you live in, where people decide to travel regardless of the price? Flying may be much cheaper than it used to be, but it's still a non-trivial expense. Raise the fare $10 above a family's vacation budget limit, and they will drive or stay home.

 

[NewHampshire Black Bears]

Call it what you want, but when competitors attempt to coordinate pricing in a deregulated environment, it's illegal, therefore collusive, behavior.

Then again, I'm sure you know more about antitrust issues than the folks at the DOJ...

[post="197322"][/post]​

+++++++++++++++++++++++++++++++++++++++++++++++++

"E",
Speaking of collusion, remember when our dear (ex) uncle Bobby Crandall, got caught with his hand in the (collusion) "cookie jar"(Harding Lawerence/Brannif)("you raise your fares, I'll raise mine") ??
Ah, the good old days !!!

(Uncle) Bobby got a slap on the wrist, while anyone else might have gone to the "can" !!!!!!!!!

RLC, you were the GREATEST(SOB), but OUR SOB !!!!!!!!!!!!!!!

Now he's on AMTRAK's BOD's, and coincidently virtually EVERY Acela Express, between BOS/NYC, and NYC/DCA is jammed packed !!!!!!!!!!!!!

IMHO, that crotchity ol' Bastard NEVER had/Never will, have an equal !!!!!!!

NH/BB's


Ps,
I think I'll STOP making political predictions, for a while !!!!!!!!!

 

[goingboeing]

+++++++++++++++++++++++++++++++++++++++++++++++++

"E",
Speaking of collusion, remember when our dear (ex) uncle Bobby Crandall, got caught with his hand in the (collusion) "cookie jar"(Harding Lawerence/Brannif)("you raise your fares, I'll raise mine") ??
Ah, the good old days !!!

(Uncle) Bobby got a slap on the wrist, while anyone else might have gone to the "can" !!!!!!!!!

RLC, you were the GREATEST(SOB), but OUR SOB !!!!!!!!!!!!!!!

Now he's on AMTRAK's BOD's, and coincidently virtually EVERY Acela Express, between BOS/NYC, and NYC/DCA is jammed packed !!!!!!!!!!!!!

IMHO, that crotchity ol' Bastard NEVER had/Never will, have an equal !!!!!!!

NH/BB's
Ps,
I think I'll STOP making political predictions, for a while !!!!!!!!!

[post="198428"][/post]​

I agree that RC was the best CEO that AA has had in the past 20 years.DC or GA are not even in the same league as RC.
RC is the one still testifying before Senate Aviation subcommittes about the state of the airline business.
This airline would have already been back to financial health if RC had been CEO and AA would have NOT bought TWA.
I wish the BOD had the guts to bring him back after the DC fiasco.
There were times while RC was CEO that I was not happy with him but he cared about the long term condition of AA.
He was hell on unions but that same intensity of power was used against our competition.I was glad that he was pitching for our team in the big game called the airline business.
It doesn't hurt to reflect on the past history of AA but all of us have got to move on and AA needs to make major changes soon or its survival is in doubt.
The changes needed are a lot more than just labor being blamed for being over compensated.

 

[laura62]

With Southwest's success and AA's lingering death, the best we can hope for is for them to buy us, or at least our assets. Then we can keep our seniority (or perhaps some of it) and be elevated to their pay (and benefits) scale.

[post="196796"][/post]​

Perhaps Southwest would be kind enough to give AA employees the same sweet deal AA gave the TWA employees.

 

[firstamendment]

Perhaps Southwest would be kind enough to give AA employees the same sweet deal AA gave the TWA employees.

[post="202896"][/post]​

Very good, Laura62!!!

 

[MCI transplant]

Very good, Laura62!!!

[post="202910"][/post]​

<_< From the standpoint of an ex-TWAer, not so good!!!!! :down: And First, I don't see the hummor in that!

 

[jsn25911]

<_< From the standpoint of an ex-TWAer, not so good!!!!! :down: And First, I don't see the hummor in that!

[post="202983"][/post]​

Is Laura62 being sarcastic? The deal would have been sweet had AA followed the agreement promised upon. I can't believe that someone would think being put out on the street for years is a sweet deal.

 

[jsn25911]

wrenched wrench wrote: With Southwest's success and AA's lingering death, the best we can hope for is for them to buy us, or at least our assets. Then we can keep our seniority (or perhaps some of it) and be elevated to their pay (and benefits) scale.



Well if you brought planes, routes, landing rights, etc - why shouldn't you get seniority? If it is two great airlines being combined into one great airline - why shouldn't you get seniority?

 

[firstamendment]

<_< From the standpoint of an ex-TWAer, not so good!!!!! :down: And First, I don't see the hummor in that!

[post="202983"][/post]​

Well I read it as sarcasm...and thought it was funny . I think the point she was making was that what goes around just might come around. Lighten up, man! :down:

 

[aafsc]

Perhaps Southwest would be kind enough to give AA employees the same sweet deal AA gave the TWA employees.

[post="202896"][/post]​

I don't think that AA unions would ever surrender their labor protective positions in their contracts. (At least I hope not).

 

[Drippy Quill]

I don't think that AA unions would ever surrender their labor protective positions in their contracts. (At least I hope not).

[post="203035"][/post]​

TWA had the same "successor clause" in their contract. Do not believe for a minute that anyone is safe from non-unionistic actions as experienced by the workforce of TWA.