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#2802337 - 11/14/12 12:18 PM Airlines not profiting? Economy on recession?
JHZR2 Offline



Registered: 12/14/02
Posts: 35553
Loc: New Jersey
Then why is every single parking spot at Philadelphia Airport, short term included, full? Drive around for a VERY long time in the D,E,F garage looking for one of the four last spots in the complex.

Was never this bad even when the economy was strong.

Somebody is flying and spending money.

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#2802341 - 11/14/12 12:21 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
MarkStock Offline


Registered: 10/23/12
Posts: 635
Loc: CA
TSA parking

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#2802355 - 11/14/12 12:37 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
PandaBear Offline


Registered: 08/05/02
Posts: 12649
Loc: Silicon Valley
They may change the amount charge to increase / reduce the demand on parking to keep it always near full, so it is not a good indicator of whether the parking is profitable or not, let alone the airline. This doesn't means the airlines are selling all seats at profit and this doesn't means the airline has the flexibility to increase / reduce seats or routes.

A lot of the losses of airlines are due to high fixed cost that cannot be throttled back. If you have 100 planes on mortgage it would cost you the same whether you fly or not. If you have 30000 employees with retirement liabilities (i.e. health care cost for life), you cannot just say "we are not going to pay for it anymore" and expect no strikes. Then of course there's the fuel contract you got 3 years ago may or may not be the same as the one your competitor got last year. Southwest was very profitable previously as they got some very good fuel contracts, basically gambled and won.


Edited by PandaBear (11/14/12 12:38 PM)
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#2802365 - 11/14/12 12:43 PM Re: Airlines not profiting? Economy on recession? [Re: PandaBear]
Tempest Offline


Registered: 03/21/06
Posts: 10490
Loc: Las Vegas NV
Originally Posted By: PandaBear
This doesn't means the airlines are selling all seats at profit and this doesn't means the airline has the flexibility to increase / reduce seats or routes.

A lot of the losses of airlines are due to high fixed cost that cannot be throttled back. If you have 100 planes on mortgage it would cost you the same whether you fly or not. If you have 30000 employees with retirement liabilities (i.e. health care cost for life), you cannot just say "we are not going to pay for it anymore" and expect no strikes. Then of course there's the fuel contract you got 3 years ago may or may not be the same as the one your competitor got last year. Southwest was very profitable previously as they got some very good fuel contracts, basically gambled and won.


+1 Cost vs. sales price has no direct correlation.
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#2802376 - 11/14/12 12:58 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
Pop_Rivit Offline


Registered: 02/09/08
Posts: 4270
Loc: Midwest
That's a false assumption based on an illusory correlation.

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#2802378 - 11/14/12 01:02 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
Miller88 Online   content


Registered: 04/09/08
Posts: 8528
Loc: Onondaga County
The executives are running away with all of the money

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#2802402 - 11/14/12 01:33 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
dparm Offline


Registered: 04/19/10
Posts: 12612
Loc: Chicago, IL
Originally Posted By: JHZR2

Somebody is flying and spending money.



If anything, flying might be UP for certain industries during this period.
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#2802407 - 11/14/12 01:37 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
D189379 Offline


Registered: 09/01/04
Posts: 1283
Loc: Canada City, Canada
Originally Posted By: JHZR2
Then why is every single parking spot at Philadelphia Airport, short term included, full? Drive around for a VERY long time in the D,E,F garage looking for one of the four last spots in the complex.


You should give advice on the stock market.

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#2802447 - 11/14/12 02:14 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
FowVay Offline


Registered: 06/02/02
Posts: 2319
Loc: Southeastern USA
The cost of operation is killing the airline industry. Fuel is the biggest expense and it's unpredictable.

I work for Delta in Atlanta where I do non-destructive testing in the engine overhaul facility. We build engines for nearly every airline in the world. It's a very expensive operation. A 767-400 will set the company back $200 million, a engine overhaul costs about $5 million, and a single tank of fuel for a long-haul route to Germany will cost the company about $70,000.

Delta has about 750 aircraft so you can imagine the cost burden to operate these things. And they're very high maintenance. Add airport fees to the cost of operating the aircraft and the numbers are mind boggling.

Plus, every passenger wants to fly across the continent for $99 which is simply unrealistic.

Yes, our seats are full and our planes are all up and flying but our profits simply aren't materializing. If we make a few hundred thousand in profit for the quarter we're happy. But keep in mind, a few hundred thousand dollars won't even buy a single compressor spool for a C6-80C2 engine.

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#2802452 - 11/14/12 02:19 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
rjundi Offline


Registered: 03/16/04
Posts: 7155
Loc: USA
Fuel prices were a lot different then.

Also business then was more apt to spend the money on full price seats that covered off the cheaper ones folks get now. There is essentially a travel ban at the company I work for and they are a MAJOR user of airlines.

I think flights now are more planned and the "cheaper" seats.
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#2802457 - 11/14/12 02:26 PM Re: Airlines not profiting? Economy on recession? [Re: Tempest]
PandaBear Offline


Registered: 08/05/02
Posts: 12649
Loc: Silicon Valley
Originally Posted By: Tempest


+1 Cost vs. sales price has no direct correlation.


Cost and price has direct correlation. Price and profit has no correlation.
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#2802468 - 11/14/12 02:33 PM Re: Airlines not profiting? Economy on recession? [Re: PandaBear]
Tempest Offline


Registered: 03/21/06
Posts: 10490
Loc: Las Vegas NV
Quote:
Cost and price has direct correlation.

Then can you please tell me what that correlation is?
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“Never underestimate the difficulty of changing false beliefs by facts.” --- Henry Rosovsky

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#2802496 - 11/14/12 02:48 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
JHZR2 Offline



Registered: 12/14/02
Posts: 35553
Loc: New Jersey
Lol, amazing how serious people took this post.

It was primarily out of frustration.

Parking prices haven't dropped, and PHL tends to be costlier than other airports in the region (BWI advertises here for example).

Still, I fly at least once a month, and routinely park in the short Term garage. It has not been as routinely packed and extremely full in the last 10 or so years.

People are flying. That's all it means, nothing more, nothing less. But they are flying, and are parking, and boy is it frustrating!

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#2802505 - 11/14/12 03:03 PM Re: Airlines not profiting? Economy on recession? [Re: Pop_Rivit]
JHZR2 Offline



Registered: 12/14/02
Posts: 35553
Loc: New Jersey
Originally Posted By: Pop_Rivit
That's a false assumption based on an illusory correlation.


Somehow the ever increasing price, and expanded size parking garages being completely full routinely when I've flown for the last many months is illusory?

Who else is paying $16/day to park at the airport? The retail wage slaves inside?

So where exactly is the false assumption? People are flying and parking in large numbers to do so. Or do more people parking in the airport garage correlate to LESS people flying?

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#2802520 - 11/14/12 03:19 PM Re: Airlines not profiting? Economy on recession? [Re: JHZR2]
Mr Nice Offline


Registered: 09/12/04
Posts: 13926
Loc: USA
Ask your wife to drop you off and pick you up.Problem solved.

But I agree with you, I was at MIA a few months ago and the parking garage was packed.
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