ARE AIRLINES PROFITING FROM THE CANCELLATIONS?

It costs a lot to fly a plane, it costs almost nothing to not fly it. And they already have your money

 

 

The question that, stunningly, no-one has asked, until we did, is: How much money are the airlines saving by not flying the planes they have already collected the revenues for, and kept the vast majority of? 

 

How much is falling to their bottom line from canceling so many flights? 

 

The answer is probably tens, if not hundreds, of millions of dollars. 

 

And if they’re saving as much money from not flying planes as we suspect, what incentive do they have to start flying those not-as-profitable routes again? 

 

We repeatedly asked the airlines — literally dozens of requests for interviews and responses to very specific questions were made to the top US carriers, American, Delta, United and Southwest, and not one replied to our emails or phone calls. A couple sent canned statements proclaiming how wonderfully they were doing. 

 

So we clearly had questions they didn’t want to hear. 

 

They stonewalled us — while being completely and perpetually available to any reporters that wanted to repeat and increasingly lather the airlines’ rather lame and vague excuses of labor shortage, bad weather, and, just generally, Air Traffic Controllers. 

 

We couldn’t find out exactly what the average cost of flying a commercial flight in the US is — as several sources told us, including active commercial pilots who flew with these airlines, it is a closely guarded secret. 


But we know it costs something to fly a plane. We can say with confidence it’s not free, and it doesn’t, say, cost just 1,000 dollars to fly a plane. Jet fuel is insanely expensive and planes use literally tons of it. That’s the biggest but not only cost — there’s crew,  airport fees, ground crews, maintenance, insurance, crew accommodations, in-flight food and drink, and, ironically, delays, which cost the airlines several billions of dollars a year.

 

We can, we think, also safely presume it costs more than 5,000 dollars to fly the average flight. If it costs $10,000, for instance, and you cancel 1,000 flights in a day, then that’s $10 million just for that day. But, more likely, it costs more. 

 

One very thoroughly calculated statistic we found publicly available, at aviation.stackexchange.com, is that the average cost of flying a commercial flight is $21,000 – $42,000 per hour, with the higher figure apparently factoring in airplane depreciation and other accounting costs that wouldn’t be relevant to a cancellation. And that article is five years old. Let’s go out on a limb here and say expenses haven’t gone down in the last five years.

 

There have been 145,884 canceled flights through Aug 15 of this year that were scheduled to fly to, from or within the U.S. Among U.S. carriers there were 138,000 cancellations. Do the math. 

 

Any way you slice it, that’s a lot of potential savings. 

 

Remember, the airlines keep the money from the flights they cancel (more on that below). And if they don’t fly the planes they sold tickets to, they collect these revenues without incurring the cost of delivering the advertised product.

 

Put another way, imagine you bought a ticket to watch a film in a multi-screen cinema. When you go, expectantly, to your screening room, the person collecting the ticket says “that movie’s not on today. You can come back tomorrow and maybe it’ll be showing, or you can wait a while and go see a different one in a room where we are showing movies and have some unsold seats. Alternatively, we’ll give you credit to come back some time and see a different movie. Either way, we’re keeping your money!”   

 

That’s what’s happening with airline cancellations. You will be, in a way that is logistically convenient for the airlines, not you, re-booked or re-routed to your destination. Or you’ll get a “travel credit,” which you might not ever, realistically, be able to use. You are entitled to a full refund if the airline (not you) cancels your reservation (more on that below too), but the companies almost never tell you that, or offer it, and the implication is very much go the way we want to send you, or take a credit, or nothing

 

 

 

 

 

A 2021 investigation by the Wall Street Journal found that the big four airlines “had $10 billion in unused travel credits on their books at the end of 2020.” That number will have surely increased by August of 2022.

 

Have the airlines learned how to send people the same algorithmically efficient way parcel carriers like UPS and FedEx ship a package, which is almost never in a straight line? 

 

“No question. We are packages to the airlines. Absolutely,” says Bill McGee, senior fellow for aviation at the American Economic Liberties Project. Bill has been in the airlines industry, in one capacity or another, for 37 years, including seven years in airline flight operations, all over the world but mostly out of New York’s airports. He also spent years as an aviation journalist, writing a book called Attention All Passengers, a sort of Kitchen Confidential for air travel. About 13 years ago, he became an advocate for airline passengers. 

 

“There’s no question. Not operating the flight, for obvious reasons, I mean, it’s sort of ‘duh’, it’s going to be revenue positive for you. Assuming you’re not giving back a hundred percent of the fares.”

 

 

 

 

Was it deliberate, was it not deliberate, to cancel flights to make more profits, at the expense of millions of dislodged, deeply inconvenienced passengers?

 

To be completely clear, we don’t think somebody said: I’ve got a great idea! Let’s sell 10 flights and fly 6! We don’t think that happened. As one of our sources affirmed, there were “operational problems that snowballed, it wasn’t intentional.” But did something like this happen: an airline schedules 10 flights, discovered they could only fly six, and were tearing their hair out with the problems that caused them, frantically trying to figure out how to get out of the cratering hole they were falling into, when somebody walked into someone’s office and said, “We just made a load of money because we didn’t spend a lot that we expected to spend, but we get to keep the revenue for the tickets we sold.”

 

And did somebody else then say, “Oh, if we’re making millions of dollars extra to the bottom line, let’s drag our feet a little”?

That’s the million/billion dollar question. It’d be great to know the answer. But, perhaps unsurprisingly, no-one at the airlines wants to give it to us.

 

 

 

 

“Cancellations aren’t free. It’s true, they could make more money [not flying scheduled planes] but it comes with some expense to their reputation. Now, the industry is consolidated so the customer may not have much choice next time they fly anyway, so I guess that depends,” says Robby Silk, Airlines Editor at Travel Weekly.

 

“They have to give refunds to the extent that a passenger demands it,” he continues. “They try to just give you a credit. Most people don’t know their passenger rights, which are limited in the US compared to a lot of other countries. 

 

“A lot of the operational problems were related to lack of foresight, poor management in a lot of cases. Yes, it’s possible that as they’ve gone through these periods, they’ve had to make some cynical decisions. I wouldn’t be surprised if cynical decisions like that were made. But as far as it being a systematic direction, I don’t think that would be the case. They do have a lot to lose by running crappy operations.” 

 

Charlie Leocha, Chairman of consumer advocacy group Travelers United, is a regular thorn in the airlines’ side, but doesn’t believe the airlines are systematically canceling flights to save/make money. “I really think that the airlines right now are trying to fly as many people as they can. I do not believe that they are creating additional problems for themselves by canceling flights on purpose.

 

“What we’re really faced with is there’s no penalty for the airlines to be out of whack and to have their entire system fall apart. The airlines make up the schedules, and they try to fly that schedule, but if they can’t, it’s just tough luck to the passengers, not to the airline.”

 

“I think it’s a very credible theory. I’m not on the inside. I can’t say. I can only make an educated guess, as you are,” says Bill McGee. “If I was Pete Buttigieg, I would give you an answer on Monday, because I’d go into their offices today and say ‘let me see your books. We want to see your records on crew scheduling, aircraft scheduling, maintenance, all the rest of it,’ so they could get a sense of the million dollar question: are airlines knowingly scheduling flights with the full knowledge that they will not be able to operate them?

 

“Because what are they doing? They’re putting flights in reservation systems, on their websites, and through travel agents and online travel agencies. You’re basically putting out a binding contract, you’re taking reservations and, more important, taking money from people. They swipe your credit card, the money’s taken out of your account. It’s in the airlines coffers now, they’re earning interest on it, and yet they may not have the ability to operate these flights.   

 

“Having been around the industry a long time, I’ve seen a lot of cancellations over the years for a lot of different reasons, but not in this way. This is the worst summer I have seen. I know a lot of old timers around longer than me and they all say the same thing. One, we’ve never seen the sheer number, the level of cancellations, and two, and this is the critical part, the number of last-minute cancellations. That’s not acceptable.”

 

 

 

 

 

 

 

So, as the kids like to say, how did we get here?

 

Winston Churchill once said: “Never let a good crisis go to waste.” 

 

And, one wonders, is that what the airlines have come to think?

 

The crisis is real, whether created by almost unfathomable mismanagement or staggering incompetence is debatable. (What it was not created by was the weather, or Air Traffic Controllers.) 

 

The major US airlines are indisputably among the worst companies in the world for customer service, but they are not stupid companies and they are not incompetent, in fact they are just about the finest tuned of money making machines. So it is reasonable to suspect that when cancellations began to be a bit like a runaway train, they saw, in the unsettling chaos, a chance to operate flight schedules more efficiently, economically and profitably. Which wouldn’t be a bad thing if it wasn’t at the expense, and utter disregard, of the paying customers, the travelers trapped in the maws of a defacto, unregulated monopoly.

 

In a way, it was that cliche of a perfect storm. There were some bad storms, but not to an extraordinary degree by any measure, and there were some Air Traffic Control problems, but basically the controllers have done a consistent job and handled problems perfectly fine, even if understaffed. And there are problems with getting pilots to flights, which is not the same thing as not having enough pilots — records show that there are about 4 – 5,000 more certified pilots today than there were in 2019 — but it’s a complicated, byzantine situation involving pilots who are not “current”, or are newly promoted and waiting for training, or are being conscripted from regional airlines to majors, or majors to cargo carriers. There aren’t enough pilots in planes, but there are apparently enough pilots. (If statistics can dance at the best of times, “pilot availability” statistics are at an all night rave.)

 

 

Anatomy of a flight that made it off the ground, to London, and turned around and came back…

 

 

Says Bill McGee: “This is one thing I really want to stress, when I see these statements from the airlines, or their trade group, talking about weather and air traffic control, I say no. Not as the overwhelming percentage of what we’re looking at this summer.

 

“Are there delays and cancellations due to weather and air traffic control not as staffed as they want? Yes, absolutely. Let’s put it in pie chart form. Those are two pretty small slices of pie. Overwhelmingly, this is on the airlines for their staff shortages, particularly pilots.”

 

Gary Peterson, Vice President of the Transport Workers Union, told us that he also thought explaining away poor flight performance as primarily a weather and air traffic control issue was bogus. “The airlines will never admit to it, but my view is, they saw an opportunity. They’re flushed with [bailout] cash to pay salaries, they buy out the senior people using the government money, and they turn around and they get new hires at the lowest rate.” 

 

The Bureau of Labor Statistics projects there “could be” 14,500 pilot openings each year for the next decade. But that doesn’t actually tell us if there will be pilots to fill these jobs –- the cost of getting started in the industry repels many (training can cost $100k or more). The Federal Aviation Administration — the ones issuing new pilot certificates — has issued an average of 6,500 certificates per year for the last decade. That is a giant shortfall between the (rather arbitrarily) estimated demand and actual supply. 

 

According to Future and Active Pilot Advisors (FAPA) 6,681 pilots had been hired by July. The numbers are just not adding up

 

“I think the argument the carriers would make is that they have the staffing,” Peterson says. “But they only have the staffing on a blue skies, perfect day, they don’t have the staffing when there’s a hiccup, an air traffic control delay or something happens. That can quickly start compounding. And not having backup and reserve — which, by the way, is a ton of money savings for the company again –– is making it even worse.”  

 

Well, I’ve never been to Estonia, but that flight isn’t cancelled…

A pilot who currently flies for JetBlue (but asked that we not use his name, in case of reprisals) describes what he has observed happening.

 

“There is absolutely a shortage of staff in many parts of aviation. This is why we had several meltdowns in Boston on days with pretty decent weather conditions. Washington and New York were at full capacity and weren’t letting any aircraft depart Boston and fly south. In Boston, aircraft were sitting on every available square foot of asphalt, unable to get to a gate or move, several flights violated the DOT 3-hour rule [airlines must let passengers disembark if stuck on the tarmac for 3 hours] and had nowhere to go. This caused crews to time-out, and cascaded more delays and tons of cancellations for the next 2 days as well.   

 

“The pilot shortage is certainly real. Airlines are also extremely short staffed with ground personnel. 

 

“A big issue is the regional airlines. These cannot keep pilots long enough to ensure a smooth operation. The major airlines are all taking pilots at extremely high rates, which is crippling the reliability of the regionals to feed hundreds of routes. Some regional airlines are offering first-time-seen pay rates and bonuses for pilot retention, which wouldn’t be necessary without a shortage.”

 

Jeremy (not his real name), a pilot with FedEx who came over from the commercial airlines, says: “So why aren’t there enough pilots? That’s complicated. During the pandemic, several airlines made spectacular deals in order to reduce the size of their pilot force, hoping to reduce payroll losses. 

 

“They also encouraged many military pilots to take a military leave of absence and go back to their Guard/Reserve units and fly there. As for the remaining pilots, many didn’t have airplanes to fly. So there were furloughs or if they weren’t furloughed, they would pay them for a small portion of their schedule and keep them on the payroll, but non-current — non-current is when you don’t have the FAA required minimum number of landings in the airplane. 

 

“Unfortunately, when you furlough pilots or allow them to go non-current, you create a huge demand for simulator training since they need some practice before getting back into a real airplane again. Also, all those retiring pilots are usually old captains, so you have to train first officers to take their place. That’s even more training.  

 

“But now you need more first officers to replace the first officers who are training to be captains. More training. So for many ‘insiders’ the belief is that the shortage is largely a function of training capacity.”

 

FedEx didn’t furlough pilots, Jeremy says, and made huge efforts to increase its training capacity so that it could handle the increase in captain training. It was an investment wisely made.

 

 

 

 

American Airlines pilot Dennis Tajer, who is also the Communications Committee Chairman of the pilots’ union, the Allied Pilots Association, told CNBC, at the beginning of July: “The problem is that they’ve sold tickets that they don’t have the ability to fly.” He mentioned that recently his airline alone was responsible for 44% of all cancellations on one day.

 

“90% [of the cancellations] was because management couldn’t connect the pilot to the airplane,” he said. “They’ve underutilized the pilots they have, they failed to keep us current coming out of the pandemic. There’s a shortage of planning.

 

“Management has built a schedule to sell tickets for an operation they can’t sustain. Everybody is saying we don’t have enough pilots to do it — you have enough pilots, you’re not utilizing us and you built a schedule that’s not tenable.”

 

 

 

“It’s a reality that the airlines — not laid off, but bought out a lot of pilots, I think like 15,000 during the pandemic. These are experienced pilots, and they needed to replace them,” says Robby Silk, the aviation journalist.

 

“I don’t think there is a question as to whether the bail-out money was used by the airlines appropriately. They paid staff. I think the bigger question is, why weren’t they ready to ramp up?”  

 

There was a floated suspicion that the airlines took some of the $54 billion of taxpayer bailout money to buy back stocks. Charlie Leocha doesn’t believe they did, either. 

 

“No, they weren’t allowed to do that. They weren’t allowed to give themselves any raises at the management levels. The airlines didn’t break any rules. They’re very careful about that. 

 

“It turned out to really be an unemployment program on steroids. The pilots and the flight attendant unions — they offer them early retirement and people just went through it in droves. More people took it than they thought.”

 

 

This is not far from the madding crowd, this is the madding crowd

 

 

 

“What did the airlines do? They found a loophole,” says Bill McGee. “They started encouraging early retirement, and to state the obvious, some professions have a more intense training and hiring process than other professions. Clearly, when you lose pilots, it’s not easy to go out and find another one and have them up to speed in a week, nor should it be, for safety purposes. 

 

McGee isn’t buying the airlines’ hype that they couldn’t have predicted the demand increase.   

 

“I’ve been hearing some in the industry saying they didn’t know that traffic was going to come back. Let me stop right there. I know this for a fact, the major airlines have entire departments that do nothing — long before COVID — but just look at worldwide, national and regional trends to try and gauge traffic because they have to schedule aircraft and crews 11 months in advance.

 

“This is unacceptable. I say this emphatically because you’d be amazed at the things schedule planners look at, things you and I would never think of. Dormant volcanoes. I’m not kidding. Every terrorism report in the world and countries that may be quiet now, but could be problematic in six months. That’s what they do. To tell the public in the summer of 2022 ‘We didn’t know demand was coming back.’ The roll-out of the vaccines occurred when, January of 2021? 18 months ago.”

 

He believes a big part of the problem is that airlines became that other horrible cliche, too big to fail.

 

“We used to say, 10 or 12 years ago, the airline industry is approaching the ‘too big to fail’ marker. That discussion is over. We’re there. We’re down to four major airlines. 

 

“American, Delta, United, and Southwest, with their regional partners, which is critical, control about 85% of the US market. We’ve never, since the first airline ticket was sold in 1914, had that level of concentration. Whenever there’s any disruption, the airlines are going to get a taxpayer bailout. That’s a given now.

 

“We said back in 2020, ‘Okay, you’re going to give them money. But let’s have some provisions in there for consumers.’ Well, that didn’t happen. Congress only put one caveat on the $54 billion. They said, ‘You will keep your staffing up to speed so when eventually COVID recedes or people start flying again, you’ll be ready to do that.’ That was the whole point of the CARES act.

 

“In the EU and in Canada, there are passenger bills of rights, uniform, consistent regulations, mandatory [for] a flight delay of any length, cancellation, you get involuntarily bumped, etc. The irony is US airlines behave much better and treat their passengers much, much better when they’re not on American soil. If there’s a delay in any EU country, they are mandated to do things not mandated in Atlanta or Chicago or Dallas.”

 

Also, according to McGee, the airlines don’t fear the Department of Transportation (DOT). 

 

“Why would they? There hasn’t been a single fine levied against the US airlines under this administration or the last one for $10 billion in unpaid refunds. And for these massive flight cancellations. So why would you fear DOT? The only real protection you have, and it’s easy to find, you just have to google ‘dot.gov flight refunds’, is, if your flight is canceled, for whatever reason, doesn’t matter, whether it’s the airline’s fault, or whether it’s a force majeure [like] a thunderstorm, you are entitled to a full — I’m going to stress this word — cash refund.

 

“A lot of those vouchers have expiration dates. There should be no expiration date. It’s my money!”

 

Recently, Travel Weekly, reported that Senators Alex Padilla and Elizabeth Warren wrote to Secretary Buttigieg to demand tougher action —well, it couldn’t be less tough, could it? — pointing out that on top of the cancellations, the airlines have increased domestic fares, year over year in June, by a staggering 34.1% on average.

 

“After receiving tens of billions of dollars in assistance from American taxpayers, major airlines have reciprocated by dramatically increasing ticket prices and reaching new lows in their treatment of travelers,” the senators wrote. 

 

They also insisted that DOT address the issue of overbooking (talk about getting to a party late…), writing: “For decades, airlines have systematically oversold their flights, offering tickets they know they can’t fulfill. When this gamble fails, it should be airlines — not consumers — that pay the price.”

 

We asked Charlie Leocha if he felt, as we do, that the public have been pretty openly treated like doormats.

 

“They have,” he replied. “They’ve been absolutely duped — and [going back to 2020] the passengers who gave up their flights after President Trump said, ‘Don’t fly on the weekends. Don’t go home for the holidays’ [because of the pandemic], who thought they were being patriotic by not going home [and canceling flights] — the only thing they got was the airlines just said, ‘Bend over. Grab your ankles.’”

 

 

Why hasn’t the DOT done more to make them accountable? 

 

“Well, I’ve asked the DOT exactly that question and their answer to me is, ‘We think our job is not to punish airlines, but our job is to move as many people as possible.’   

 

“Our last Secretary of Transportation [Elaine Chao], at least she was straight with me. She looked me in the eye and said, ‘Charlie, nothing’s going to happen.’”

 

In one news report, an analyst at the Teal Group, Richard Aboulafia, claimed airlines couldn’t predict when exactly travel would return. “Who could have predicted that?” he said with a straight face. He went on to say that if the airlines had done what they, frankly, committed to do in order to get the $54 billion, then they would have found themselves in a deeper financial hole.

 

“By having too little capacity, you’re embarrassed, [but] if you get it wrong by having too much capacity, you run the risk of bankruptcy,” he said.

 

Congresswoman Eleanor Holmes Norton, who is on the subcommittee that oversees the airlines, had a rather blunt response to that: “Any fool could tell that as COVID declined, airline traffic would go up,”

 

Senator Warren is also not impressed. The airlines received government support — and salvation — purely because they are essential to the country’s infrastructure, she maintains. “If they can’t keep their promises to taxpayers and travelers, Congress should find out why.” 

 

 

 

On July 21st American Airlines CEO Robert Isom appeared on CNBC’s Squawk Box. He was giddier than a teenage boy who’s just lost his virginity. 

 

Positively beaming, grinning from ear to ear, he was literally bouncing in place. He was gleefully cooing — boasting — to the CNBC audience, the one audience that might rub its hands and lick its chops at how much money American Airlines made in the second quarter. Forget the millions of disrupted, seriously inconvenienced, poor old flotsam that represent the airlines’ clientele, their paying customers, now herded zig zag across the country with connection-whiplash, he’s making money for his shareholders! (And, one presumes, ultimately for himself.)  

 

“I’m so pleased to be here, reporting a net income of $533M,” he gushed. “It’s a really important day for American Airlines.” Then he tumbled out: “Got work to do on reliability.” 

 

When asked, about the torrent of cancellations and unhappy travelers, almost apologetically, because, after all, that somewhat harshed the mellow, he said through his Cheshire Cat grin “We’re taking the steps to make sure our customers are taken care of.”

 

What planet is he standing on?

 

Just over a week earlier on Squawk Box, Delta CEO Ed Bastian also reported a healthy profit for the same quarter. Saying that the industry had been “starved” the previous two years, he explained the present awful situation by saying: “We pushed too hard. We scaled back a bit… and in July we’re running a great operation.” 

 

He must be Isom’s neighbor in that parallel universe.

 

Back in the real world, where people sleep on airport floors, Robby Silk informs us that the airlines’ load factors, the percentage of occupied seats, “are really high. United’s reported for the last quarter was 86.7%. The other ones are similar.” 

 

Bill McGee put this in perspective: “Throughout the history of the industry, all of the 20th century, they usually hovered around 65%. On average, 100 seats, 65 are occupied. These days they’re about 90 percent. 

 

“They’ve made a system now where the flights are completely full. If one thing goes wrong — look, something always goes wrong, that’s just nature — the system dominoes and collapses.

 

“In the full year of 2021,” he continues, “the DOT reported that there were 121,552 canceled flights. In the first six months of 2022, January through June 30th, it was 121,918. We already, half the year, exceeded the total for 2021.”

 

Sara Nelson, the President of the Association of Flight Attendants union, who frequently butts heads with the carriers, is a tad more sympathetic, although offers an important caution about their near future intentions.

 

“In fairness, they’re just now making a profit,” she says. “It doesn’t look anything like the kind they were making pre-pandemic. But now is the time to watch. What are they going to do with the stock buyback ban ending September 30? Delta is already hinting they’re going to reinstate stock buybacks instead of doing what they should’ve been doing after all these losses, after this crisis, reinvesting in the workforce and in the infrastructure so that, you know, people can actually count on an airline industry.”

 

Of course the humongous crisis could have been avoided if the airlines had prioritized travelers over profits and stock prices. Jeremy from FedEx, who not long ago was flying for one of the big carriers, is not so naive as to be surprised though.

 

“The airlines would’ve needed to begin training flight crews months before the end of COVID restrictions in order to be prepared for the surge. But is it cheaper to train people early and then sit and wait for the rebound, or wait for the rebound and then just cancel flights because who cares about canceling if we’re making money and eventually we’ll catch up? I have a feeling that the latter may have occurred and the former was viewed as an expensive “maybe.”  

 

“And if you are completely soulless and don’t care about customers, canceling flights that aren’t going to be profitable makes sense. 

 

“Your only risk is whether or not customers will return, but it doesn’t seem that canceling flights has greatly affected the demand for flights. And so what the union and pilots are suspicious is occurring, the airlines generated massive schedules that most likely couldn’t be flown unless flight crews were 100% healthy and were flying lots extra. They could then see which flights were profitable, cancel the non-profitable ones, and then just revise the trips to put the crews on those profitable trips. The union and flight crews hate this because it often results in having trips extended or flying extra legs and getting less rest.” 

 

 

 

When asked if the airlines can profit from canceling a flight, Gary Peterson of the Transport Workers Union replied: 

 

“It’s a shell game, right? I got your money, you have an expectation, but there’s no penalty if I don’t fulfill the expectation, and all I need to do is come up with an excuse. Oh, it was weather, oh, it was someone else. And then I’m completely off the hook, and you’re stuck holding the bag, but I got your money. No other business can do this.

 

“I don’t know if it’ll ever go back [to the way it was pre-pandemic], because they figured out how much money they can save by, for lack of a better term, screwing the passengers. And, you know, I get capitalism and free enterprise, but I think it’s grossly unfair to the flying public.” 

 

As long as people continue to — other than complain, which gets them nowhere — accept the cancellations, the inconveniences, the lost time and money and opportunities because the airlines left them high and dry, what incentive do the airlines have to change a situation that’s saving/making them tens of millions of dollars?

 

“You’ve asked a great question,” replies McGee. “I would say, if you are a CEO of an airline — let’s take morality out of it. Let’s not talk about doing the right thing — and you have to answer to the DOT and they haven’t fined you as much as a nickel for your terrible behavior over the last couple of years, not giving refunds during COVID, canceling flights at the last minute, and you have not been called on the carpet, what is the impetus for you to start doing the right thing? 

 

“It’s one thing to be too big to fail, it’s another thing to be too big to care. That’s what we have.

 

“As a business model, life is good right now, if you’re an airline executive, not if you’re an airline passenger.” 

 

“The general consensus,” suggests FedEx’s Jeremy, “no matter from which perspective, is that this was more or less a perfect storm, and that resignation to that papers over other contributing factors, such as, how much money are airlines saving not flying a portion of flights, flights that generated lots of ticket revenues that were and are being retained, and the obligation of a flight met by substituting another way to get a traveler to their destination, regardless of how inconvenient and unpleasant?

 

“So was it a perfect storm? Maybe, if the term is necessary to make a headline stand out. But part of me thinks that one Cat 5 hurricane is no more ‘perfect’ than another Cat 5 hurricane. And even if it was ‘perfect,’ we could see each warning sign slowly unfolding. We knew we were extremely short flight crews, we knew we didn’t have training capacity, we knew there would be a summer surge, and we knew COVID restrictions weren’t permanent.  

 

“Looking at the issue right now, the logjam creating the ‘perfect storm’ is, in my opinion, an inability of airlines to rapidly train/retrain crews to meet the flight schedule. And from a corporate standpoint, is it really a storm at all if profits are strong?  And does the corporation care if the storm will most likely disappear when the summer demand recedes?”