2nd Quarter 2007 Unit Costs

[Be Careful What You Wish For.]

The BTS doesn't define it (that I've found on their website), other than it's one of the operating expense catagories. The other's are Flying Operations, Maintenance, Passenger Service, Aircraft And Traffic Servicing, Depreciation And Amortization, Transport Related Expenses, and Total Operating Expenses.

Some of those are defined in more detail. For example, Passenger Service is defined as "Cost of activities contributing to the comfort, safety, and convenience of passengers while in flight or when flights are interrupted. Includes salaries and expenses of flight attendants and passenger food expenses." Maintenance is defined as "All expenses, both direct and indirect, specifically identifiable with the repair and upkeep of property and equipment."

Administrative seems relative straight-forward......all the "back office" work that isn't related to providing transportation like the HR department or the pass bureau. I assume that "General" is operating expenses that don't fit in any other category.

Jim

I appreciate your reply and thank you.

I still do not know what the answer is as far as why we have appreciably higher costs. The answer in years past seemed to be that operating on the east coast was a reason but after 2 BKs and a seeming lack of spending on any improvements to the airline-why are we so high?

Again, thanks for your previous reply.

 

[BoeingBoy]

My 2 cents? East has always been high cost relative to it's peers as measured by CASM. An inefficient operation (everybody else has de-peaked their hubs to some extent), lots of shorter routes (shortest average stage length except WN), still 2 fleet types in several capacity ranges (737-300/A319, 737-400/A320, etc), still a large part of the operation in the NE, etc.

As far as BK, they cut expenses but also cut ASM's (returned planes) so the two largely canceled each other out. The old "you can't shrink to profitability" thing.

Jim

 

[Pacemaker]

A route-structure akin to a large regional like Comair using primarily 737's and A319's on short stage-lengths with relatively low daily utilization. The unit costs for some regionals are even higher than US Airways. Factor in inordinate exposure to inefficient airports and airspace and inclement weather. The airplanes spend a lot of time on the ground. I think the point has been more or less driven home by now that it has comparatively little to do with employee compensation.