Get ready folks!

[ChrisH]

Pricing may not be the sole problem, but wouldn't you say it is part of the problem? There is so much competition, especially from LCCs, but also among the legacy carriers, themselves, that it is almost impossible to raise prices. If the airlines merge, thus creating less competition, doesn't it allow the airlines to better control pricing?

If the cost to produce a product, or provide a service, increases, most companies will raise the price of said product, or service, to counter the increase in their cost. Fuel has tripled, but yet airfare has remained statistically the same, for about 20 years. The airlines effectively cannot operate like a normal business, and just raise fares, but why? I understand the argument that it is a commodaty, but that isn't entirely true. I know plenty of people who only fly one airline, regardless of price, because it offers "better service", in their mind.

[surreal1221]

Originally Posted by Chris_Ford

Take that, airline pricers and everyone with a PhD in economics. Surreal has solved the airlines' problems!!! Hurrah!!

Don't you think they would charge more if it would assure them a profit? Clearly it does not.

You're a character, that's for damn sure.

Nevertheless, I think that yes the airline pricers, and everyone with a PhD in finance or economics that works in the airline industry is failing at their jobs. These companies are businesses, and every business I know is not a net neutral business. They don't work to break just RIGHT at even every quarter or year.

If you're going to make a profit you MUST charge an appropriate fare for your services. Skywest Inc (as much as I hate to reference the company) has shown that if you charge a cost appropriate for what you're going to provide, and some (them selling their services contractually to the heavy lift providers) you might actually turn a damn profit.

Now, all the legacies (screw the LLCs. . .they can continue, and you can not compete with them if you are a legacy) need to do is just do the same to their customers. Charge them an appropriate fare, all the time, and turn a profit.

I know you economics and finance gurus want to make this more complicated, and I'm sure it's not just THAT simple. . .but it really is that simple.

So what if the customer gets pissed. They're still going buy a ticket that takes them from NYC-LAX, ATL-SEA, or the like. They have no other choice. Greyhound? Amtrak? Yeah, that'd be fun.

Hell, maybe if after these companies start turning a good profit they can then develop and upgrade the services they provide - so as to emphasis the fact that their service is worth the additional price to the consumer.

But hey C_F, I know you love the all mighty consumer, so great for you.

I on the other hand, I could care less about how they feel. If they end up getting pissed off cause they can not get $99 round trip across the country on Delta, United, American, US Airways, or Continental they can go and seek the mode of transportation that can provide them that cost.

Originally Posted by Chris_Ford

Maybe it's because the answer isn't as simple as "raise prices"

May not be that simple, but it's certainly not that complicated. Raising prices, fares, to a certain level to offset the increased cost of the service provided will certainly help things move towards developing a profit.

If you'd like to discuss this, let's keep it professional.

Originally Posted by jtrain609

It isn't? If you know it isn't, then you must know the answer.

So what is it, oh great one?

Now now, don't go name calling John.

[kellwolf]

Originally Posted by surreal1221

But, they don't - and would rather chop the knees off of their labor force to try to save two cents. It's ridiculous.

Exception to that rule, however. SWA hasn't chopped the knees off of their labor force. They've been hit by hard times, and still manage to eek out a small profit while other airlines are losing their shirts. Why? Pro-active management would be my answer. Granted, they often DO lead the charge in fare hikes, and on many routes actually charge MORE than legacy airlines. Many people just automatically assume SWA has the lowest fare and go with them. That's a result of a good branding scheme. For years, SWA was almost always cheaper than the legacies. Now that the public has gotten used to that way of thinking, they've slowly suck their way up on fares. Yeah, they've still got "Fun Fares" on a lot of flights, but there aren't near as many seats available at those fares as there used to be.

SWA has gotten to where they are by utilizing smart management. Now, what happens when Herb AND Colleen are gone.....who knows.

[surreal1221]

SWA is a great operating airline, no doubt. You're right, they haven't chopped the knees of of their labor force because they haven't been put into a position that requires them to cut costs significantly.

SWA has never filed bankruptcy. The majors have, a number of times.

When times get tough, the companies look towards the fast way to save some pennies. Instead of making more pennies, they end up just cutting their workforce. Which does nothing for generating a profit. It cuts their costs, but it has never moved a company from negative numbers to positive numbers.

If you want to make more money, use your resources, and increase the cost of your product.

[Chris_Ford]

Originally Posted by surreal1221

You're a character, that's for damn sure.

Nevertheless, I think that yes the airline pricers, and everyone with a PhD in finance or economics that works in the airline industry is failing at their jobs. These companies are businesses, and every business I know is not a net neutral business. They don't work to break just RIGHT at even every quarter or year.

I'll let my friends in the pricing biz know Nobody in the entire pricing game is smart enough to figure out how to just raise their prices. Come on, you know that's foolish. There are a lot of smarter people out there, and I'm sure it's been tried. The only way to make profit is to cut cost (ala SWA) not to increase revenue.

If you're going to make a profit you MUST charge an appropriate fare for your services. Skywest Inc (as much as I hate to reference the company) has shown that if you charge a cost appropriate for what you're going to provide, and some (them selling their services contractually to the heavy lift providers) you might actually turn a damn profit.

Apples to oranges. Fee for departure is a lot different ballgame than having to do everything "at-risk"

Now, all the legacies (screw the LLCs. . .they can continue, and you can not compete with them if you are a legacy) need to do is just do the same to their customers. Charge them an appropriate fare, all the time, and turn a profit.

That's the whole point, you cannot compete with the LLCs, so legacies can't just up the price, because nobody will fly on them domestically.

I know you economics and finance gurus want to make this more complicated, and I'm sure it's not just THAT simple. . .but it really is that simple.

No, it's not. You even shot a hole through your own argument in the previous sentence.

So what if the customer gets pissed. They're still going buy a ticket that takes them from NYC-LAX, ATL-SEA, or the like. They have no other choice. Greyhound? Amtrak? Yeah, that'd be fun.

They do have a choice. NYC-LAX, I'll take Southwest out of Islip, or Jet Blue out of Kennedy. ATL-SEA? I'll take AirTran, Frontier, or SWA out of BHM. Why should I, the consumer, pay $50 more for a ticket on United when I get the same benefits as riding on Southwest? At least the folks on Southwest are in a cheery mood.

Hell, maybe if after these companies start turning a good profit they can then develop and upgrade the services they provide - so as to emphasis the fact that their service is worth the additional price to the consumer.

The whole point of this is that nobody cares. Nobody wants extras, unless the price is the same as the competitors. Even then, there are a ton of other things that determine booking. For example, when I book airline tickets, I book as follows:
1) Price [the cheaper the ticket, the more I can spend on my vacation]
2) Number of stops
3) Time of departure

I don't really care if I get fed. That's not their responsibility.

Besides, there's already an "upper class" alternative, NetJets. Airlines can't offer that sort of service. They're stuck in obsolescence between the new guys, LCCs and NetJets. You're asking them to pick a very thin demographic.

But hey C_F, I know you love the all mighty consumer, so great for you.

That's because I am a consumer, and so are you.

I on the other hand, I could care less about how they feel. If they end up getting pissed off cause they can not get $99 round trip across the country on Delta, United, American, US Airways, or Continental they can go and seek the mode of transportation that can provide them that cost.

They tried that in 2000, it worked out miserably. I know people who work and have worked as pricers. It's just not that simple. If anything, you need to cut your costs.

May not be that simple, but it's certainly not that complicated. Raising prices, fares, to a certain level to offset the increased cost of the service provided will certainly help things move towards developing a profit.

If you're company B and producing your widgets at Company A's price + 25, you cannot last. It's *that* simple. The only other way to do it is create some sort of faux idea of luxury, but again, that's NetJets (and that's real luxury).

If you'd like to discuss this, let's keep it professional.

As long as you respect the fact that the people who price are not simians. They are well educated and know a lot more about their job than you do. What you're doing is comparable to people saying "Well my uncle lives in Pittsburgh and it's not raining there!"

[Ian J]

I just want everyone to know I am not an expert in the airline business.

Nor am I an expert in unions, contracts, or negotiations.

I am also not an expert in airline history.

Or to stay in my own lane, I am not an expert in part 135 freight.

I figure since everyone knows so much, I better chime in with my qualifications too. I just want to make sure no one listens to me in case I accidentally start talking about something I couldn't possibly know about.

[Ian J]

Originally Posted by Firebird2XC

I few months ago.. I dated an Amflight pilot that claimed she actually did strip down in the cockpit.. being alone and all.

I call the concept to question.. but it's a fun visual.

>shrugs<

You can really do whatever the heck you want when you're single pilot. Just ask Lloyd!

[surreal1221]

You're right Ford.

I have my thoughts on how an airline could return themselves to making profits. $1 here, $5 here, $10 here. . .along with a number of other steps.

I don't think it's THAT difficult.

[KLB]

Originally Posted by Ian J

I just want everyone to know I am not an expert in the airline business.

Nor am I an expert in unions, contracts, or negotiations.

I am also not an expert in airline history.

Or to stay in my own lane, I am not an expert in part 135 freight.

I figure since everyone knows so much, I better chime in with my qualifications too. I just want to make sure no one listens to me in case I accidentally start talking about something I couldn't possibly know about.

I'm in the same boat as you bud. Everytime I'm going to attempt to contribute to these discussions, I think I'll preface it by saying, "I know I'm only a freight pilot, but"....

[Ian J]

Originally Posted by KLB

I'm in the same boat as you bud. Everytime I'm going to attempt to contribute to these discussions, I think I'll preface it by saying, "I know I'm only a freight pilot, but"....

IF I ever get into airline flying anyone can feel free to beat me with a stick if I ever claim I know how an airline should be run.

[MQAAord]

Originally Posted by surreal1221

The majors have, a number of times.

Not all the majors have declared bankruptcy.

[EatSleepFly]

Originally Posted by Ian J

IF I ever get into airline flying anyone can feel free to beat me with a stick if I ever claim I know how an airline should be run.

I'd say I'll hold you to it, but I know you wouldn't spew crap like that anyways.

And those who do, won't make a similar offer.

[Firebird2XC]

Originally Posted by Ian J

You can really do whatever the heck you want when you're single pilot. Just ask Lloyd!

In Lloyd's case, I'm not sure I wanna know.

Being naked and alone is like the tree falling in the woods. If nobody sees, who cares?

>shrugs<

I did alot of single pilot time building. I got bored. Used to try to cycle runway lights from cruise altitudes.

[SteveC]

Originally Posted by surreal1221

You're right Ford.

I have my thoughts on how an airline could return themselves to making profits. $1 here, $5 here, $10 here. . .along with a number of other steps.

I don't think it's THAT difficult.

Not that difficult? Then why, in your opinion, don't they just raise their prices?

[Chris_Ford]

Clearly Steve they're too stupid to figure that part out I mean they only have degrees (some advanced) from accredited universities...

[mojo6911]

I am just going to make myself as marketable as possible. CFI until ATP mins (already sitting on 1200 or so hours), I have a BS degree, and am going to get as much multi-PIC as possible in the next 2 years at a 135 op.

[surreal1221]

Originally Posted by SteveC

Not that difficult? Then why, in your opinion, don't they just raise their prices?

My opinion is simple. I feel, as a member of the aviation industry, that these airlines think that their customer base will just DRY up the moment they raise fares.

I, disagree with that.

But because of that fear, and their oh so great education from accredited universities they must stay inside the box.

But don't worry Steve, I don't deal with finances and economics - so as has been said already it is merely my opinion. I just fly the planes.

Originally Posted by Chris_Ford

Clearly Steve they're too stupid to figure that part out I mean they only have degrees (some advanced) from accredited universities...

Clearly Chris. . .Clearly.

I don't think I have ever once called anyone stupid. I have my opinion on how these companies can really develop a profit. It is not JUST about raising fares, but you will see a larger return on your product if you increase the cost to the consumer rather than chop the knees off of your labor force. This goes for any industry.

But yes, while I do not hold an economics or finance, or aviation management degree my opinion on this matter will never even register in your brain.

[Chris_Ford]

Well I can't argue with someone who has no facts to back up his argument, so I guess you win? You're wrong, but you win. How's that for a stalemate.

[surreal1221]

Chris,

People hold opinions, with or without facts.

I don't operate in the financial sector. So does that mean that I can not provide any opinion on the matter?

I suppose in your world that would be how you would operate. Do you never comment on a subject that your degree does not cover? Or are you the true renaissance man and can comment on any and everything?

If you insist on taking your ball and going home, fine bud. I just don't see what the big deal is for someone to hold an opinion.

[EatSleepFly]

Is there anything you don't happen to have an opinion about? Just curious.

[Chris_Ford]

Originally Posted by surreal1221

Chris,

People hold opinions, with or without facts.

I don't operate in the financial sector. So does that mean that I can not provide any opinion on the matter?

I suppose in your world that would be how you would operate. Do you never comment on a subject that your degree does not cover? Or are you the true renaissance man and can comment on any and everything?

If you insist on taking your ball and going home, fine bud. I just don't see what the big deal is for someone to hold an opinion.

You're entitled to your opinion, but I'm saying that 1) Airlines have tried the raising prices game [in 2000], and it didn't work. 2) I'm good friends with airline pricers and I know how they work. I'm providing you with empirical data and you're disregarding it.

I'm not taking my ball and going home. I've proven everything I can and you're too stubborn to understand.

[surreal1221]

Chris, I understand exactly what you are saying. No worries there comrade. I just have provided an opinion, and I certainly didn't think it was going to be some huge issue.

I'm sorry if you think that I'm attacking your buddies who are pricers. They have their system, and they use it to extract the most that they can - good on them.

Can we hug it out?

Originally Posted by EatSleepFly

Is there anything you don't happen to have an opinion about? Just curious.

Sure. Lots of things. Growing up in an airline family (albeit, I don't have friends who are airline pricers) I've seen pretty much every area of the airline industry, except for cabin cleaning and catering.

[GalaxyIFE]

Oh look, another contest....

[mtsu_av8er]

Originally Posted by Firebird2XC

In Lloyd's case, I'm not sure I wanna know.

Man, twice once between Miami and JAX!!!

[SteveC]

Originally Posted by surreal1221

Chris,

People hold opinions, with or without facts.

I don't operate in the financial sector. So does that mean that I can not provide any opinion on the matter?

You are certainly entitled to your opinion, with or without good reason. Just be aware that ill-informed or uneducated opinions are often questioned, sometimes even by people that do know what they are talking about . That's the other half of the *freedom-to-hold-whatever-opinion-I-want* equation. If someone wants to hold an opinion without having any reality based information to back it up, they certainly shouldn't feel put out if their opinion is not taken seriously.

That's just my opinion, of course.