Seggy
Well-Known Member
Yeah, sleeping on it, I am probably wrong with this. Just going off something I heard a few years ago.
Us prop pukes aren't that smart
Delta's Hiring Freeze and Q4 Loss
- Thread starter meritflyer
- Start date
Yeah, sleeping on it, I am probably wrong with this. Just going off something I heard a few years ago.
Us prop pukes aren't that smart
OldTownPilot
Well-Known Member
Anywho, Its all about the yield, not the load.
Charter companies make money when 1 person flies on a learjet.
Fuel, 175 gal @ $4/gal is $700. Various figures have shown that fuel is about 1/3 the total operating cost of a flight. So that would mean its about $2000 dollars to fly a 1900 on a 1 hour flight. Divide $2000 by however many people you want your breakeven point to be (add your EAS subsidized seats here) and that is the cost per ticket, for your choice of "breakeven passengers".
Charter companies make money when 1 person flies on a learjet.
Fuel, 175 gal @ $4/gal is $700. Various figures have shown that fuel is about 1/3 the total operating cost of a flight. So that would mean its about $2000 dollars to fly a 1900 on a 1 hour flight. Divide $2000 by however many people you want your breakeven point to be (add your EAS subsidized seats here) and that is the cost per ticket, for your choice of "breakeven passengers".
That's probably not true. Very few of those people are flying ONLY that segment and so the revenue from their ticket has to be apportioned between that segment and any subsequent segments.
How you apportion the revenue from segment to segment is going to be stunningly complex and in the end it's pretty hard to look at individual segments and decide if they are profitable or not. You have to look at the overall market (the originating city) and where people travelling from those markets are going and what they are paying for those tickets. Overall then that market may be profitable, even though in and of itself the segment is not profitable.
Face it - if the individual segment operated by an RJ was profitable somebody else would be flying it (ExpressJet for one, SouthWest for another). But it's not, the segment only makes sense as part of a larger network.
RJ pilots have got to stop kidding themselves - RJ operations are not profitable on a revenue per segment basis. Comair is not profitable, Eagle is not profitable. The only reason non-wholly owneds are profitable is because they're paid on a plane lease and fee for departure basis. If RJ segments were a profit center why do you think regional operators recoil violently when asked to take revenue risk? If RJ segments were a profit center the regionals would drop their legacy contracts, setup as operations under their own names operating the same segments and start putting the money in the bank. Yet few of them do, and those that do fail (Independance Air, watch this space for ExpressJet).
kellwolf
Piece of Trash
Replace a majority of those flights with 700s and I bet those routes are not "probably profitable" but "very profitable"
Hence the reason Mesaba and Compass are starting to fly some of those routes.....
kellwolf
Piece of Trash
Don't do a lot of flying in the South, huh? I check the bag tags when I'm doing my post flight on the walkaround. An awful lot of them say MEM, not connecting and going somewhere else.
Why would SWA use RJs when they can operate a larger aircraft and fill more seats? Economies of scale works in their favor. In order not to lose so much money due to spillage, they'd have to operate 2-3 RJ at the same time on the same route. That's gonna cost more $$$ than 1 737. Now, if the segment only has 43-50 people, it'd be crazy to fly a 737 on that route since you probably wouldn't break even unless a majority of those people were on full fare tickets. What you're missing here is PCL isn't the one that makes the call on what segments they fly. NWA makes that call. In the end, they're the ones that get the profit of the tickets, not us. So the question for them is "Is the outsourced labor cheaper or is it cheaper to use our own guys?"
I've got a little more faith in XJT's management than you, apparently. Then again, I've actually worked under them before. You'd probably see more regionals striking out on their own if it weren't for one thing: branding. Regionals don't have to carry a marketing department, fare structure experts, etc, etc since mainline does all that for them. If you strike out on your own, that even more costs you're gonna have to take on. You can't just say "Well, if the routes were profitable, then more RJ operators would do their own thing." It's more complicated than that. You have to figure out how to get people on your plane. Dropping the mainline connection loses the website, 800#, frequent flier program, and (most of all) the name recognition. The marketing and the loss of passengers that don't recognize "Pinnacle' as a reputable airline but know "Northwest" pretty well would kill some of the most profitable routes since you've now got to absorb that marketing strategy into what profit there was. Then take into account that mainline carriers like NWA will take a loss on routes since they're big enough to count on more profitable routes subsidizing it in order to keep passengers, and it's a tough world. Ask Frontier how well their MEM flying is going. NWA launched what amounted to a "Oh no you don't" campaign against them when they started flying into MEM. As of JAN, the A319 is gonna be a thing of the past here. It's gonna be E170s. But, I guess according to your thinking a half full A319 would be more profitable than a full E170.....
Whatever gets you out of bed in the morning - but if you think NWA is running Pinnacle flight for people to use the hubs as destinations and originations you're nuts.
There's a point in here somewhere, but I'm missing it. It will almost certainly be cheaper to use an outsourced supplier, but they use their "own guys" because of scope clauses. First NWA figures out what size aircraft to use on a segment, THEN they figure out who is going to fly it.
Again, I'm sure you've a point in this ramble somewhere, but I'm missing it. Airlines defend their hubs for a variety of reasons none of which have anything to do with the profitability of individual segments.
If you don't understand that people fly the cheapest ticket, regardless of name recognition, then you're ill equipped for a discussion of airline economics. If "Pinnacle" was cheaper than "NWA" for a segment people would fly Pinnacle. However - for all the reasons laid out in previous messages "Pinnacle" could not be cheaper than NWA on the segment, because in and of itself THE SEGMENT IS UNPROFITABLE.
If it makes you feel better thinking that the flying you're doing is profitable then have at it, but the flying you do is important, but it is not, in and of itself, profitable.
meritflyer
Well-Known Member
The reality CFIse is you really dont know. You're stating your opinion and it's coming across as fact. You're nor I are CFO's, CEO's, directors, or contollers at airlines so your argument carries little water since it's all hearsay.
Well the actual reality is that I can read the financial statements of public companies, but you live in your world, I'll live in mine.
meritflyer
Well-Known Member
LOL!
Financials huh.. Okay. Have fun with all the balance sheets and 10-Q's since us businessmen need Mesa pilot's to help understand such filings.
kellwolf
Piece of Trash
I'm not an airline econ guru, but I'll admit that. I guess that's where you and I differ, though.
As far as financial advice, I think Merit's got ya beat on that one. The guy digs into financial reports, 10-Qs and SEC filings for fun.....
Alchemy
Well-Known Member
Guys....just fly the plane.
My F.O. last trip....
"man, I hear we're going down to 20 lines in base next month, base could be closing, we're not hiring, perm bid is cancelled...."
Me:
"So, you said you're going skiing next week?"
I do my best not to worry about this stuff. Go to work, do the best you can, always keep your resume fresh, and add to your qualifications as best you can. You should be doing that even in the best of times in this industry. Let the chips fall where they may.
Then again, it might be easy for me to say because I'm absolutely ASTONISHED at how great this career has treated me so far. For awhile I kept bracing for some wave of pain and misery that never materialized. Now I just go with it....I'm sure it's coming eventually, but I'm almost to the point of welcoming the challenge.
/Dr. Phil
My F.O. last trip....
"man, I hear we're going down to 20 lines in base next month, base could be closing, we're not hiring, perm bid is cancelled...."
Me:
"So, you said you're going skiing next week?"
I do my best not to worry about this stuff. Go to work, do the best you can, always keep your resume fresh, and add to your qualifications as best you can. You should be doing that even in the best of times in this industry. Let the chips fall where they may.
Then again, it might be easy for me to say because I'm absolutely ASTONISHED at how great this career has treated me so far. For awhile I kept bracing for some wave of pain and misery that never materialized. Now I just go with it....I'm sure it's coming eventually, but I'm almost to the point of welcoming the challenge.
/Dr. Phil
I'm not giving anybody financial advice - except I'll echo Warren Buffet, don't ever invest in the airlines. If "merit" is so good at reading reports then he needs to stop attacking the facts and start doing some critical thinking about WHY mainlines continue to run money losing operations (and the answer is because, in the whole, they contribute to the overall profit by feeding traffic to the profitable segments).
jtrain609
Antisocial Monster
20 lines!? If we've got bases that small then there should be a SLC base with Delta! Heck, just a reserve base would be awesome. I'd bid long call and ski all the time
kellwolf
Piece of Trash
20 lines!? If we've got bases that small then there should be a SLC base with Delta! Heck, just a reserve base would be awesome. I'd bid long call and ski all the time
"Yeah, I'll be there in about 2 hours."
<wooooosh.....trip.....AAAHHHH
"Yeah, scheduling. I gotta call in sick. I broke my leg on the way down the slope."
jtrain609
Antisocial Monster
Soul Brotha'
Off to go do Black guy stuff
Well said Alchemy. Guys get to worried about stuff they have no control over. Show up to work and if the check clears on payday, you're okay.
I agree that it makes no sense to worry about things over which you have no control. However, I also wouldn't advocate the ostrich approach. Burying your head in the sand doesn't make your problems go away and, especially as a captain, you do have options. If things start going south at your company it may be the time to start working on attending an air inc fair, or finally applying to Netjets, or whatever. If you wait to act until the furlough notice hits your box, you'll be at the end of a very long line.
My advice would be the same for positive rumors: believe it when you see it, but be prepared for anything. Stressing about every "what-if" scenario will probably solve nothing but your high hair care bills ('cause you'll probably be bald). Burying your head in the sand will keep your blood pressure low, but bad stuff does happen.
My advice would be the same for positive rumors: believe it when you see it, but be prepared for anything. Stressing about every "what-if" scenario will probably solve nothing but your high hair care bills ('cause you'll probably be bald). Burying your head in the sand will keep your blood pressure low, but bad stuff does happen.