Brainstorm - Appealing to airlines' profit interests

Discussion in 'Aviation Passenger Security in the USA' started by CelticWhisper, Oct 24, 2012.

  1. CelticWhisper

    CelticWhisper Founding Member

    So in the wake of the Andrea Abbott ruling, it hardly needs mentioning that we're all pissed off. Maybe it's anger leading to clarity, maybe it's just an oddly-timed flash of inspiration, but I had an idea this morning that might work along a different angle.

    This is going to be disjointed and awkward because between fuming over Andrea, dealing with work, and the idea only being a few hours old, I haven't thought it through completely yet, but here goes anyway:

    We've tried the stick - keeping pressure on TSA is slow going but it's showing at least some results, mostly with regard to Congress getting irritated. Is it time for the simultaneous application of the carrot?

    What if we were to put together, along with FTTUSA and other travel-freedom groups, a campaign to help get the airlines to lobby for a return to private screeners? I wouldn't have considered it but for the recent article on how airline execs were urging reworking of airport security.

    It would go something like:
    "Here's your problem: your customer figures suck, Amtrak is eating your lunch, WN is the only one of you turning a profit and the usage of your services has been equated to living in Nazi Germany or Soviet Russia by a large segment of the population.
    Here's the reason: An out-of-control government agency stands directly between your customers and your services, and has made itself entirely unreasonable in every facet of allowing your customers to access your services.
    Here's the solution: Flex that lobbying muscle and get these thugs removed and replaced by someone who can be held accountable, even if only by lawsuit, to your customers.
    Here's the incentive: If you do this, we, the undersigned, pledge not only to resume flying again, but also to bite the bullet, save our cash, and purchase a round-trip FIRST-CLASS plane ticket within the next (Year? 2 years?) to get your business back on track."

    It would need, at least:
    -Someone who's up to speed on flight figures and the recent history thereof (Mike comes to mind first, with his knowledge of furloughed planes, flight numbers, pax loads, etc., but I'm sure others know too and can step in so Mike can focus on running TUG) to make the case that their business is suffering and we know it.
    -Someone with at least some media connections to drum up publicity (Lisa? Do you still lurk here? Maybe we can recruit you for this, if that's okay by you.)
    -Someone who knows how to speak the airlines' language. I'm good at principled and philosophical arguments but I don't know airline business lingo worth a damn.
    -Someone who can get petitions written, worded clearly, and widespread.
    -Maybe someone who's a general marketing/publicity guru to put the requisite polish on the whole thing to sell it to the airlines.

    Thoughts? Is this totally insane? Am I dreaming here, or are we at the "Fsck it, we have nothing more to lose" point and thus due for a plan like this? I've flown free for the past 4 years (well...the first 2 of the past 4 anyway, before S&G started), but I'd do it. First time I'd ever have flown first-class but I'd do it if it means seeing TSA shitcanned once and for all.
  2. Mike

    Mike Founding Member Coach

    Delta has also been reporting some very large profits since the merger of two post-bankruptcy legacies, and they are very much pro-TSA. CEO Anderson sucks up to TSA like you wouldn't believe. Delta has always had an almost-suicidal focus on short-term profits, i.e. what's in it for me now. Getting rid of TSA, which relieve them of a large cost center, isn't remotely on their horizon.

    United has also posted some profits. When they were at CO, the Larry (since left for other pursuits) & Jeff show were very anti-TSA, but it was aimed more at air marshals poaching their first-class seats. With smaller F cabins than the other airlines, the poaching had a signficant effect on their first-class sales & revenues.

    If AA survives bankruptcy, they'll be similarly profitable, at least as well off as United.

    I don't think the industry is as ripe for this as you perceive. It's more overseas airlines observing at a distance that are seeing the light.
  3. Mike

    Mike Founding Member Coach

    Still, there's some promise in this. I do like the part about "Amtrak eating your lunch". Leave out the part about Nazi Germany.

    Aimed at the legacies: Amtrak is eating your lunch, and WN is #1. Where is that going to leave you?

    WN won't care. They #1 & growing, slowly & deliberately.
  4. DeafBlonde

    DeafBlonde Original Member

    I'm sorry, call me a pesimist, but I think the ONLY thing that will rattle the airline's cage is a massive (and I'm talking m-a-s-s-i-v-e) boycot of air travel. They only care about the bottom line and that's where they have to be hit to get them to turn on the TSA once and for all. Just MHO, though.
    Monica47 likes this.
  5. RB

    RB Founding Member

    When the airlines went to the business model of packing people in like cattle I think they lost any desire to provide service any higher than absolutely needed. I don't see the airlines getting in this TSA battle unless people stop flying.
  6. Frank

    Frank Original Member

    (expletive deleted), some of these idiots are proposing to replace seats with saddles to pack 'em in even tighter.
  7. Fisher1949

    Fisher1949 Original Member Coach

    In my spare time I dabble in investments and follow financial news nearly as closely as TSA stories.

    Playing around with the numbers leads me to project that there will be an inevitable period of stagflation around 2015 (or sooner) no matter what Congress and the WH do. The effects of quantitative easing and a weak dollar coupled with slow job growth will result in a period of rising prices (inflation) and nearly flat personal income increases (stagnation) that will add to pressure to many market segments, particularly those requiring discretionary purchases such as airlines tickets, restaurants and sports.

    At that point, many market sectors will come under tremendous pressure to enhance the attractiveness of their products to compete for a dwindling pool of discretionary income. Other venues, such as restaurants, sporting events and sport equipment don's have the onerous burden of TSA hostility and aren't as severely impacted by rising fuel costs as airlines. While these other industries do feel some impact from fuel costs, they are proportionally much smaller in terms of their overall cost cost structure and they have more options in terms of reducing that impact.

    When these pressures come into play, airline profits will become losses and they will be scrambling to increase passenger loads just to meet their minimum obligations on equipment leases, maintenance, landing rights and gate costs. I expect they will take a more hard line position on TSA at that time but will not be receptive to doing so in the near term.
  8. Mike

    Mike Founding Member Coach

    Published yesterday about an hour ahead of this thread ...

    AJC: Delta posts $1 billion profit [$1.05B]

    Atlanta-based Delta Air Lines reported a $1 billion profit in the third quarter, after boosting revenue slightly while cutting flight capacity and staff. The airline nearly doubled its profit compared with the same quarter last year, though this year’s September quarter profit included a $440 million gain in the value of its fuel hedges for the future.

    YOY operating revenue is only up 1%, so there is no significant growth -- just restructuring & cutting to force profits.

    Uninental announced a mere $6M profit today, but part of this was the result of a $454M writedown to cover future costs of a pilots' contract. YOY revenue down 2.6%.

    In terms of actual cash added to the piggy banks in the 3rd quarter (i.e. factoring out the writedowns) Uninental made almost half a $B, and Delta made more that $1.05B since they also had some writedowns.

    The stagnant revenues from people not flying are a problem, but the numbers mask that.
  9. Mike

    Mike Founding Member Coach

    & keep in mind that the U.S. population grows 0.9% annually. In terms of revenue, Delta is barely maintaining its position, Uninental is losing.
  10. Fisher1949

    Fisher1949 Original Member Coach

    There is a reason that airline stocks have generally trended negative since 2008. All the accounting tricks in the world won't fool the analysts. The jig is up and the egotists running the airlines are solely focused on short term gains since they know that is all they have to work with.

    Just a matter of time and the day of reckoning comes as it has in Greece. It's ugly, but a foregone conclusion.

Share This Page