PSA 900 Financial numbers...

[Crzipilot]

I know there's some Closet Airline Financial wizards out there that like to play with numbers. Was curious if someone could figure something out.

If PSA gets 40 900's configured at 88 seats. That results in 3520 seats/day avail. or 1,267,000/yr. Average stage length 350miles??? or an extra 443,520,000 ASM. Anyone pull out what kind of money and such this can result in??/ .10 yield??? Just curious approx. what type of in flow of cash they are wanting with no pay raises, for an aircraft basically bringing in 30% more revenue.

 

[WSurf]

I know there's some Closet Airline Financial wizards out there that like to play with numbers. Was curious if someone could figure something out.

If PSA gets 40 900's configured at 88 seats. That results in 3520 seats/day avail. or 1,267,000/yr. Average stage length 350miles??? or an extra 443,520,000 ASM. Anyone pull out what kind of money and such this can result in??/ .10 yield??? Just curious approx. what type of in flow of cash they are wanting with no pay raises, for an aircraft basically bringing in 30% more revenue.

Does it matter? For the payrates you will fly them for it will make money!!!

 

[Crzipilot]

Ya, I know Wsurf, Make a stand like every other regional has out there to save this industry. In fact, here we are going to double your fleet of Dhc-8's with Q400's, but the catch is. in order to afford this upgrade we need a 5-10% pay cut....

 

[BoeingBoy]

If PSA gets 40 900's configured at 88 seats. That results in 3520 seats/day avail. or 1,267,000/yr. Average stage length 350miles??? or an extra 443,520,000 ASM. Anyone pull out what kind of money and such this can result in??/ .10 yield??? Just curious approx. what type of in flow of cash they are wanting with no pay raises, for an aircraft basically bringing in 30% more revenue.

1 - One small correction (or addition). Given your assumption of a 350 mile average stage length, your math is correct as far as it goes, which is for 1 segment per day 365 days a year. But you need to factor in the number of revenue flights or segments per day to get the total ASM's generated per year. Don't know what the number of segments per day would be, but if one assumes 6, that brings total annual ASM's to 2,698,080,000. That's right, nearly 2.7 BILLION new ASM's.

2 - Then you need RASM, which is determined by yield and load factor (or revenue divided by ASM's, if you should happen to have that). Without RASM, the "guesstimate" gets to be more and more "guess" and less "timate". Just for grins and giggles, let's assume a 10 cent RASM, instead of yield. The math gives a total revenue of $269,808,000, or $270 million per year for a round number.

3 - Of course, as any decent economists (or accountant) will tell you, revenue is only half the story. The other half is expenses (or CASM, which can be compared to RASM). That's where things get murky fast, since the CRJ-900's haven't been flying that long. Presumably, one could make something of an educated guess at CASM (or expenses) if one had the figures for the PSA CRJ-700/200's.

4 - Lacking any real CASM or expense numbers, let's look at this from a different angle - CASM differential due to pilot pay. Let's assume that all other employees make the same whether they're working on or in the CRJ-900 as they would the CRJ-700, since that's the way it works on mainline. So let's assume two scenerios - pilot pay is the same (#1) and pilot pay is $15,000 more per year (#2) with $10,000 for the captain and $5,000 for the F/O.

In scenerio #1, employee cost would be basically the same and would have no affect on CASM since the employees would be making exactly the same.

In scenerio #2, let's assume 5 crews per plane (5 captains and 5 F/O's) X the 40 planes equals 400 pilots (200 captains and 200 F/O's). That's $2 million in extra pay to captains (200 X $10,000) and $1 million in extra pay for the F/O's (200 X $5,000), for a total of $3 million in extra expenses. Divide the extra cost by the ASM's and you get an increase in CASM of 1.1 cents.

Jim

 

[Crzipilot]

Jim,

I thank you very much for that. Pretty much what I was looking for, and a damn good job considering they don't break out those numbers from Group for express. Though I would imagine yield and such is probably fairly close to mainline, though I could be wrong.

Gotta love the new labor friendly way of America West.....lol...

 

[BoeingBoy]

Though I would imagine yield and such is probably fairly close to mainline, though I could be wrong.

My pleasure - just another episode of "Fun With Numbers with Mr. Magoo".

Like you, I presume that the yield on the CRJ-900's would be similiar to mainlime since they are operated on mostly mainline type routes (heck, they were mainline till planes started going away). RASM would then depend on load factor. Express as a whole generally has a lower LF (meaning lower RASM for the same yield), but I'm not sure if that's true for the CRJ-900's currently flying given the routes they're flying.

One thing that I didn't mention. $10,000 per year equals roughly $10 per hour for 85 hours per month, and obviously $5,000 per year is half that. You can use that relationship to "ballpark" how much CASM would change with different amounts of extra pay for the -900.

Jim

 

[chichi]

Ya, I know Wsurf, Make a stand like every other regional has out there to save this industry. In fact, here we are going to double your fleet of Dhc-8's with Q400's, but the catch is. in order to afford this upgrade we need a 5-10% pay cut....

PDT pilot group would say NO. Think what u want.....Some groups have backbones.

 

[Crzipilot]

You think PDT would say no. One doesn't know until faced with such a deal. The deal may even be appended with, either way, the 100/300's are going out to the pasture. Then what would your vote be? Again, no crystal ball, no telling. There's many things that have come to vote at mainline, dal, nwa, ual....that many thought the vote would be no. But when faced with realities, where did the vote go.


One advantage of PSA taking them, is the idea of a back door towards Brand Scope. keep as many airplanes inside the group fold. As opposed to Air Whisky, mesa, TSA, CHQ, colgan, air midwest, Republic, et al...... Might not be what ALPA is thinking, but they should be. Now if we could just get AAA/PSA/PDT Mec's to get along.....and get all the contractors OUT.
everyone hold hands now....

 

[chichi]

You think PDT would say no. One doesn't know until faced with such a deal. The deal may even be appended with, either way, the 100/300's are going out to the pasture. Then what would your vote be? Again, no crystal ball, no telling. There's many things that have come to vote at mainline, dal, nwa, ual....that many thought the vote would be no. But when faced with realities, where did the vote go.
One advantage of PSA taking them, is the idea of a back door towards Brand Scope. keep as many airplanes inside the group fold. As opposed to Air Whisky, mesa, TSA, CHQ, colgan, air midwest, Republic, et al...... Might not be what ALPA is thinking, but they should be. Now if we could just get AAA/PSA/PDT Mec's to get along.....and get all the contractors OUT.
everyone hold hands now....

Cant argue with that....Would rather see 900s at PSA for no more money versus the 900s going to a contract carrier.

 

[john john]

One doesn't know until faced with such a deal.

PSA was and did. That is why PSA is being offered the CRJ900 they are the weakest express carrier no solidarity management knows that PSA has a track record of taking shine new jets for below industry standard thus bringing down the industry. You can call it what you want it is a reputation that have to live with.The question is what express carrier is willing to jump on the PSA below industry standard bandwagon

 

[Crzipilot]

Actually, don't have to live with the reputation. See I went unemployed for 16 out of 28 months, or something around there. Tried to stay out of the J4J thing, but alas I was assimilated due to financial considerations no longer being able to be considered.

 

[Capecod]

Like you, I presume that the yield on the CRJ-900's would be similiar to mainlime since they are operated on mostly mainline type routes (heck, they were mainline till planes started going away). RASM would then depend on load factor. Express as a whole generally has a lower LF (meaning lower RASM for the same yield), but I'm not sure if that's true for the CRJ-900's currently flying given the routes they're flying.
Jim

The LF on the Mesa 900 in CLT (flying mainline routes) is in the range of 88%, with some routes (IAH, DFW) in the middle 90% LF.

Out West the 900s don't do quite as well (upper 70%) but still much higher then the average for all express.

As for the cost to operate, I've been told (second hand from a AW manager) that it is just slightly more expansive then the AW 733 (Mesa cost structure). Take it for what its worth.-Cape