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On 5/4/2003 9:59:08 AM Daedalus wrote:
busdrvr, your post makes it appear that jetBlue (with its 40+ airplanes) is on par with the last big asteroid that killed off the dinosaurs.
Do you really believe your own post? Or are you just trying to start a fight by flame baiting?
You sound like a hardcore union guy; if so, you can look to the US steel and auto industries to see what your future has in store for you.
Am I defending what is happening?...No. But just recognizing the fact that these changes are far bigger than any of us can hope to hold off. Like my old mother said "life is just one big bone you have to swallow and then you die." Perhaps for some of us that metaphoric bone has another use.
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Flame bait? Where is the "flame bait" What part of my post is inflamitory? Jet Blu has the distinction of having one of the lowest, if not THE LOWEST labor cost per seat mile Thier labor cost per seat mile is approx HALF low fare leader SWA''s. Is it not obvious that "productivity" simply means LESS EMPLOYEES or LOWER WAGE COSTS to accomplish the same task? I responded to the absurd post that JetBlu CREATED new jobs. In your post you pointed out the loss of jobs in the steel and auto industry as companies became more "PRODUCTIVE". In a purely "free market" idealistic world with a tight labor market, Jetblu would be considered a "good thing" Less employees flying airplanes, means more Employees availible to make widgets somewhere else. Of course the implication is with "excess" workers avail on the labor markets, and no union bargaining power to keep the price up...well you sound like you have at least a rudimentary understanding of freshman econ, what happens in a "free market" when you have an excess of a 100% perishable product? (labor can be considerd perishable since I can''t "save it up" for better times") As far as Jetblu being too small to make a diff, you must look at they way they utilize assest ina n attempt to be more "productive. They cram as many pax on an A320 as the typical carrier puts on a 757, and they utilize the jets more hours per day, thereby getting many more RPM''s per day out of it''s fleet than anybody else in the industry. Of course this means less jets required ("efficiency" and "productivity") and less jobs for Those laborers who actually build jets, freeing up the highly skilled ATP''s to make more widgets right?
Am I a left wing union crazy? Nothing could be farther from the truth. I am not a big fan of unskilled labor unions that coerce absurd levels of pay for bagging groceries. I do realize however, that to be a pilot or ATP, one must spend tens of thousands of dollars, if not over one hundred thousand dollars in real and oportunity costs to get the level of training and experience that the average Mech or pilot at a MAJOR has. Once that "money" is spent, you can''t ask for a refund, so many in the industry find themselves trying to recoup whatever they can from the investment rather than walking away. The Dr''s have the AMA and other associations to render some applicants as unworthy, thereby limiting supply. Unfortunately, airline workers have traditional relied on the pricing power, derived from imperfect information, of the hub airlines to help jusitify higher wages. Those days, for now appear to be gone. The majors WILL match the costs of the poor downtrodden LCC''s. they employees simply have too much invested not to. If you''ve read my posts in the past, you''d know I made the statement to the guys at NWA and SWA that they''d soon have industry leading pay. The question was how much they wanted that to be. They chose the lower amount, and we matched them (or undercut them).
Jetblu alone is NOT the problem. It is the combined effect of most of the LCCs who are individually small enough to expand and poach away a little revenue in the process. Realize that with airline''s your costs go down DRAMATICALLY as you grow, and go up DRAMATICALLY when you retract. Look at FRNT. They grew 17% YOY while the CEO bitterly complained to the press that there was simply "too much capacity" and that the big guys needed to cut back. of course his load factor is down YOY and his average ticket price is a whooping $108 vs $126 last year. Who is responsible for the glut? FRNT who grew 17%? ALK who added new service to DIA? Or was it UAL that has CUT SERVICE DRAMATICALLY? I don''t have the time or inclination to fully explain the particulars of game theory to the hobbyist flyer on this board who takes the occasional flilght to Kansas City and somehow thinks that makes him an expert on the economics of the industry and what fair industry wages should be, but I''m trusting you know a little more about the "big picture"