N513AU:
N513AU said: I tell you, the end is near. There will be no future with US Airways. There will be no future in the airlines. The knife of lifelong misery hangs over our heads like the blood-caked blade of a guillotine. There is no hope, people. It's just survival mode for the rest of our careers. Hope your shopping carts and cardboard boxes are ready for living under the overpass.
Chip comments: N513AU, I understand the frustration and unhappiness at the current macroeconomic environment, but I disagree with your comment above. It is true due to low carrier expansion, which has grown from 3 percent in 1990 to 20 percent of the market in 2002; there is a secular shift in consumer buying patterns. The primary consumers concern is the cost of the ticket and they are seeking the lowest fare. This is no different than you and I going to Sam's Club, Costco, or Wal-Mart and buying a product.
However, the continued terrorist attacks, the double dip recession, oil rising to over $30 per barrel, air fares at 20 year lows, rising security costs, and the pending war with Iraq are the major problems facing US and the industry. All of these problems will subside over time and if we use history as a guide.
This week saw unprecedented losses, major reductions in capacity, and huge employee layoffs. However, like all downturns this is likely to be cyclical and there will be an eventual upswing. The only question is who will make the sacrifices to be in position to benefit when the market does turn around?
According to the International Air Transport Association airline recovery after the 1991 Gulf War was:
25 percent decrease in passenger traffic during the first month of the war.
Traffic recovered to pre-war levels within about one year.
But industry economic recovery took several years; increased fuel prices compounded profitability problems.
International (especially trans-Atlantic) travel was most affected, but made the strongest recovery.
The industry recovery in the current situation depends on US economic recovery and the return of business travel, the geopolitical and military situation, fuel, insurance, and security costs, and passenger confidence and absence of new terrorism.
These are significant hurdles and the challenges are being met. Other airlines are dramatically reducing capacity which will help match the supply and demand equation, low cost airlines are seeing growing pains/their costs rise, and federal government aid is on the way.
It will take time to recover, but I agree with David Bronner that the medium to long-term US business plan is bright. However, to get to that point the airline must survive the short-term to benefit from the eventual recovery that I believe is approximately 18 months away.
Chip