Profit Estimates
- Thread starter 700UW
- Start date
28L_or_10R?
Veteran
- Joined
- Apr 11, 2008
- Messages
- 619
- Reaction score
- 216
Not a lot but much better than AMR. What a stinkeroo.
That's funny, since another thread insists that US has turned things around:
http://airlineforums.com/topic/50259-fact-you-guys-will-complain-about-anything/
28L_or_10R?
Veteran
- Joined
- Apr 11, 2008
- Messages
- 619
- Reaction score
- 216
You have misunderstood. I am saying that AMR is a stinkeroo, financially.
28L_or_10R?
Veteran
- Joined
- Apr 11, 2008
- Messages
- 619
- Reaction score
- 216
yo Ho Ho and a bottle of brass monkey...!
Art at ISP
Veteran
This is good news- that the airline is profitable...congratulations to you all, and I hope you do get nice profit sharing checks.
The fact that the amount of the profit is roughly equal to the amount collected in baggage and ancillary fees, however, indicates a fundamental flaw in the business model, which was actually admitted by Doug himself when we met with him earlier. There needs to be a wholesale realignment of fares, with the number of loser fares reduced substantially. Pricing needs to be transparent, and there are ways to do it without making people feel like they are being nickel and dimed. A tiered fare structure ala AC or Airtrash comes to mind. Pick one price you don't get a seat. Pick the next highest you pick your seat and get to check a bag. Pick the next one and you get a premium seat....etc....this is a much more transparent, and I would think easier to manage than the current system, and would go far to reduce customer outrage at having their pockets picked every time they fly.
Currently sitting in CLT waiting for a flight- let's hope I make it home today 🙂
My BEST to you all...
The fact that the amount of the profit is roughly equal to the amount collected in baggage and ancillary fees, however, indicates a fundamental flaw in the business model, which was actually admitted by Doug himself when we met with him earlier. There needs to be a wholesale realignment of fares, with the number of loser fares reduced substantially. Pricing needs to be transparent, and there are ways to do it without making people feel like they are being nickel and dimed. A tiered fare structure ala AC or Airtrash comes to mind. Pick one price you don't get a seat. Pick the next highest you pick your seat and get to check a bag. Pick the next one and you get a premium seat....etc....this is a much more transparent, and I would think easier to manage than the current system, and would go far to reduce customer outrage at having their pockets picked every time they fly.
Currently sitting in CLT waiting for a flight- let's hope I make it home today 🙂
My BEST to you all...
crazystnic
Veteran
- Joined
- Sep 28, 2010
- Messages
- 781
- Reaction score
- 727
[quote/]
The fact that the amount of the profit is roughly equal to the amount collected in baggage and ancillary fees, however, indicates a fundamental flaw in the business model, which was actually admitted by Doug himself when we met with him earlier. There needs to be a wholesale realignment of fares, with the number of loser fares reduced substantially. Pricing needs to be transparent, and there are ways to do it without making people feel like they are being nickel and dimed. A tiered fare structure ala AC or Airtrash comes to mind. Pick one price you don't get a seat. Pick the next highest you pick your seat and get to check a bag. Pick the next one and you get a premium seat....etc....this is a much more transparent, and I would think easier to manage than the current system, and would go far to reduce customer outrage at having their pockets picked every time they fly.
Currently sitting in CLT waiting for a flight- let's hope I make it home today 🙂
My BEST to you all...
[/quote]
I'm interested to see how the other airlines fare in this comparison. Are they making significant quarterly profits, not including the ancillary revenue streams? A quick google search showed that Delta, AA, and UA are among the highest in ancillary fee collections, with, for example, Delta collecting $693 million in fees in Q3 2010, on a profit of $363 million for the quarter.
Am I missing something here? Is US absolutely unique in obtaining most of their profits from ancillary fees? Someone please clarify.
The fact that the amount of the profit is roughly equal to the amount collected in baggage and ancillary fees, however, indicates a fundamental flaw in the business model, which was actually admitted by Doug himself when we met with him earlier. There needs to be a wholesale realignment of fares, with the number of loser fares reduced substantially. Pricing needs to be transparent, and there are ways to do it without making people feel like they are being nickel and dimed. A tiered fare structure ala AC or Airtrash comes to mind. Pick one price you don't get a seat. Pick the next highest you pick your seat and get to check a bag. Pick the next one and you get a premium seat....etc....this is a much more transparent, and I would think easier to manage than the current system, and would go far to reduce customer outrage at having their pockets picked every time they fly.
Currently sitting in CLT waiting for a flight- let's hope I make it home today 🙂
My BEST to you all...
[/quote]
I'm interested to see how the other airlines fare in this comparison. Are they making significant quarterly profits, not including the ancillary revenue streams? A quick google search showed that Delta, AA, and UA are among the highest in ancillary fee collections, with, for example, Delta collecting $693 million in fees in Q3 2010, on a profit of $363 million for the quarter.
Am I missing something here? Is US absolutely unique in obtaining most of their profits from ancillary fees? Someone please clarify.
Art at ISP
Veteran
Itest,
Anyone can manipulate the numbers, but I do believe that other carriers actually make money from their core operations other than just ancillary fees.
As I stated before, with the exception of Choice Seats, which is driving high value customers away despite what Tempe thinks (the actual customers have told me), most airlines are similar with their charges. IF they insist on charging extra for special seating, the seats better be more special than just in the front of the cabin...E+ is a perfect example of some value added, but at least UA respects their elites and Star Gold members and allows them to have those seats for free...
The pricing model across the board is broken and needs to be fixed.
That said I do hope everyone gets a nice bonus (except for management)...your colleagues in CLT and up and down the east coast are earning their money today!!!
Anyone can manipulate the numbers, but I do believe that other carriers actually make money from their core operations other than just ancillary fees.
As I stated before, with the exception of Choice Seats, which is driving high value customers away despite what Tempe thinks (the actual customers have told me), most airlines are similar with their charges. IF they insist on charging extra for special seating, the seats better be more special than just in the front of the cabin...E+ is a perfect example of some value added, but at least UA respects their elites and Star Gold members and allows them to have those seats for free...
The pricing model across the board is broken and needs to be fixed.
That said I do hope everyone gets a nice bonus (except for management)...your colleagues in CLT and up and down the east coast are earning their money today!!!
wings396
Veteran
- Joined
- Aug 20, 2002
- Messages
- 3,672
- Reaction score
- 1,122
The fact that the added fees are driving profits, just goes to show that the base fares aren't enough to cover costs. We all know that the employees of US have been beaten up more than enough with wage and benefit reductions to put our operating cost in line or below those of other major airlines. I know that my wages are nearly what they were 20 years ago, and some fares are as well, possibly even lower. Compare the cost of a car, food, housing, or any other consumer product to what it was 20 years ago, and I'm sure we can all agree that they have increased considerably. Then take a look at most of the airfares during that time frame. They have been flat for years while fuel and the cost of operating a multi-million dollar aircraft have increased along with everything else. It doesn't take a professor to see what is wrong with this picture. Air travel was once a premium service, and you paid for it. Today it cost less than a bus or a train in most cases even though it gets you there much faster under normal circumstances. If fees are what it takes to make US or any airline profitable, Charge Away Baby.
Similar threads
