Dave Siegel is scheduled to appear live this evening on CNBC Market Week “Special Report†with Maria Bartiromo. The show will focus on the state of the airline industry, comparing today’s airline business to that of pre-Sept. 11, 2001. Employees may find it interesting to tune in to hear Dave share his thoughts on the future outlook for both US Airways and the industry. Joining him in the interview will be JetBlue’s Chief Executive Officer David Neeleman. The show will run tonight from 9 p.m. to 10 p.m. Eastern time. Dave’s segment is expected to air between 9:30 p.m. and 9:40 p.m.
Siegel''s CNBC Interview-6/9
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Smoke and Mirrors
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My favorite quote: "If we had your (JetBlue) labor costs, we would be making money."
oldiebutgoody
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I saw it. More crap about labor cost. That Neeleman guy was pretty impressive, talking about the partnership between the employees and management, how it was his company''s plan to pay well in order to keep happy employees which would keep happy customers. Dave just said something to the tune of if he had JB''s labor cost he would be making a profit. He didn''t acknowledge Mr. Neeleman''s point that they used their assets much more efficiently than major network carriers. If Mr. Siegel wants a reputation better than that of a management (anti labor) mafioso, he needs to start talking the talk AND walking the walk.
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On 6/9/2003 9:06:42 PM oldiebutgoody wrote:
I saw it. More crap about labor cost. That Neeleman guy was pretty impressive, talking about the partnership between the employees and management, how it was his company''s plan to pay well in order to keep happy employees which would keep happy customers.
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On 6/9/2003 9:06:42 PM oldiebutgoody wrote:
I saw it. More crap about labor cost. That Neeleman guy was pretty impressive, talking about the partnership between the employees and management, how it was his company''s plan to pay well in order to keep happy employees which would keep happy customers.
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But it IS true. If U had Jblu''s labor costs, you''d be making a profit. Does that mean you are overpaid? NO, unfortunately, ponzi is alive and well, and as long as the airline in growing and the stock is appreciating, he''ll have lower costs. can that continue forever? NO.
USA320Pilot
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Tonight, Maria Bartiromo, host of CNBC’s "After Hours With Maria Bartiromo", conducted an interview with jetBlue Airways CEO David Neeleman and US Airways CEO Dave Siegel.
There was not much new discussed during the interview, but Siegel made three interesting comments, which were:
1. If he had jetBlue's labor costs US Airways would be profitable.
2. There is about 15% excess capacity in the hub-and-spoke networks. Maria interjected is that not the size of United and let's cut to the chase. If United is liquidated would that not solve your problem? Siegel replied no, what the industry needs to do is pull down excess hubs. Siegel said US Airways has difficulty making money in Pittsburgh, Delta in Dallas, Salt Lake, and JFK, as well as Northwest in Memphis. Siegel commented post Sept. 11 US Airways has pulled down 30% of its ASMs, which matches the industry RASM reduction, but the other airlines have not -- hinting the other airline's need to reduce capacity.
3. Siegel commented the excess ASM problem may be fixed as the industry moves towards consolidation.
The comments above were paraphrased.
Chip comments: When comparing labor costs between JetBlue and network carriers, one needs to view this in the form of the industry benchmark, which is labor expense as a percentage of revenue.
When conducting the comparison between JetBlue and US Airways it's not as simple as comparing W-2, it's a deeper issue.
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue's bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
These are just a few of the reasons jetBlue has a much lower labor expense than US Airways and the other five network carriers.
Best regards,
Chip
There was not much new discussed during the interview, but Siegel made three interesting comments, which were:
1. If he had jetBlue's labor costs US Airways would be profitable.
2. There is about 15% excess capacity in the hub-and-spoke networks. Maria interjected is that not the size of United and let's cut to the chase. If United is liquidated would that not solve your problem? Siegel replied no, what the industry needs to do is pull down excess hubs. Siegel said US Airways has difficulty making money in Pittsburgh, Delta in Dallas, Salt Lake, and JFK, as well as Northwest in Memphis. Siegel commented post Sept. 11 US Airways has pulled down 30% of its ASMs, which matches the industry RASM reduction, but the other airlines have not -- hinting the other airline's need to reduce capacity.
3. Siegel commented the excess ASM problem may be fixed as the industry moves towards consolidation.
The comments above were paraphrased.
Chip comments: When comparing labor costs between JetBlue and network carriers, one needs to view this in the form of the industry benchmark, which is labor expense as a percentage of revenue.
When conducting the comparison between JetBlue and US Airways it's not as simple as comparing W-2, it's a deeper issue.
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue's bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
These are just a few of the reasons jetBlue has a much lower labor expense than US Airways and the other five network carriers.
Best regards,
Chip
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On 6/10/2003 12
37 AM Chip Munn wrote:
Tonight, Maria Bartiromo, host of CNBC’s "After Hours With Maria Bartiromo", conducted an interview with jetBlue Airways CEO David Neeleman and US Airways CEO Dave Siegel.
There was not much new discussed during the interview, but Siegel made three interesting comments, which were:
1. If he had jetBlue''s labor costs US Airways would be profitable.
AOG-N-IT replies......and if a Bull Frog had wings?....it wouldn''t bump it''s butt!!!
2. There is about 15% excess capacity in the hub-and-spoke networks. Maria interjected is that not the size of United and let''s cut to the chase. If United is liquidated would that not solve your problem? Siegel replied no, what the industry needs to do is pull down excess hubs. Siegel said US Airways has difficulty making money in Pittsburgh, Delta in Dallas, Salt Lake, and JFK, as well as Northwest in Memphis. Siegel commented post Sept. 11 US Airways has pulled down 30% of its ASMs, which matches the industry RASM reduction, but the other airlines have not -- hinting the other airline''s need to reduce capacity.
AOG-N-IT replies....Look out PIT!! The MDA thing is going to reduce the supposed bloat on our mainline hubs soon enough.
3. Siegel commented the excess ASM problem may be fixed as the industry moves towards consolidation.
AOG-N-IT Replies....Consolidation???....is this more of "Wolf-Speak" in terms of merging everything until we have "Aeroflot" to look forward too??
The comments above were paraphrased.
Chip comments: When comparing labor costs between JetBlue and network carriers, one needs to view this in the form of the industry benchmark, which is labor expense as a percentage of revenue.
AOG-N-IT Replies....Doesn''t every business have to gauge things in terms of the cost of doing business Vs. doing it at a profitable level??....or have I been missing something along the way?
When conducting the comparison between JetBlue and US Airways it''s not as simple as comparing W-2, it''s a deeper issue.
AOG-N-IT Replies...I agree Chip!! , It''s much deeper!!! JetBlue does not have the history to aid in cost escalation. Look at the average time on the job between any work group that you chose for comparison?...That will more than make my point.
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
AOG-N-IT Replies....So what do we do here? Do we cut more work classifications to deliver an even more inferior product? I hope to heck not!! I''m disgusted by what''s leaving out of the hangars now. I''m not hammering safety mind you....but the house keeping issues ( Buffing , Polishing and Interior Cleaning are beyond poor , due entirely to the lack of people to do the work anymore)
Neeleman said 70% of jetBlue''s bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
AOG-N-IT Replies....I agree that U has maturity issues that JetBlue won''t have to address for many years to come....and a single fleet type is beyond ideal , but one has to ask , do we desire to be a "Niche Carrier"...or out Blue JetBlue? I hope our goals are better defined than trying to compare what we are to someone elses way of doing business. WN took a different path and has grown wildly...but we are going to be real sad if we try to shrink to JetBlues business mode to make a profit for a select few to enjoy.
These are just a few of the reasons jetBlue has a much lower labor expense than US Airways and the other five network carriers.
AOG-N-IT Replies....I agree Chip , the comparison begins and ends in a million different ways...So we need to fix our problems...and not by chopping out more of the work force. We need to find ways to make what we have work....and not by retreating from more markets either!!!
Best regards,
Chip
AOG-N-IT Replies....and regards to you as well "Mon-Capitan"
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On 6/10/2003 12
37 AM Chip Munn wrote: Tonight, Maria Bartiromo, host of CNBC’s "After Hours With Maria Bartiromo", conducted an interview with jetBlue Airways CEO David Neeleman and US Airways CEO Dave Siegel.
There was not much new discussed during the interview, but Siegel made three interesting comments, which were:
1. If he had jetBlue''s labor costs US Airways would be profitable.
AOG-N-IT replies......and if a Bull Frog had wings?....it wouldn''t bump it''s butt!!!
2. There is about 15% excess capacity in the hub-and-spoke networks. Maria interjected is that not the size of United and let''s cut to the chase. If United is liquidated would that not solve your problem? Siegel replied no, what the industry needs to do is pull down excess hubs. Siegel said US Airways has difficulty making money in Pittsburgh, Delta in Dallas, Salt Lake, and JFK, as well as Northwest in Memphis. Siegel commented post Sept. 11 US Airways has pulled down 30% of its ASMs, which matches the industry RASM reduction, but the other airlines have not -- hinting the other airline''s need to reduce capacity.
AOG-N-IT replies....Look out PIT!! The MDA thing is going to reduce the supposed bloat on our mainline hubs soon enough.
3. Siegel commented the excess ASM problem may be fixed as the industry moves towards consolidation.
AOG-N-IT Replies....Consolidation???....is this more of "Wolf-Speak" in terms of merging everything until we have "Aeroflot" to look forward too??
The comments above were paraphrased.
Chip comments: When comparing labor costs between JetBlue and network carriers, one needs to view this in the form of the industry benchmark, which is labor expense as a percentage of revenue.
AOG-N-IT Replies....Doesn''t every business have to gauge things in terms of the cost of doing business Vs. doing it at a profitable level??....or have I been missing something along the way?
When conducting the comparison between JetBlue and US Airways it''s not as simple as comparing W-2, it''s a deeper issue.
AOG-N-IT Replies...I agree Chip!! , It''s much deeper!!! JetBlue does not have the history to aid in cost escalation. Look at the average time on the job between any work group that you chose for comparison?...That will more than make my point.
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
AOG-N-IT Replies....So what do we do here? Do we cut more work classifications to deliver an even more inferior product? I hope to heck not!! I''m disgusted by what''s leaving out of the hangars now. I''m not hammering safety mind you....but the house keeping issues ( Buffing , Polishing and Interior Cleaning are beyond poor , due entirely to the lack of people to do the work anymore)
Neeleman said 70% of jetBlue''s bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
AOG-N-IT Replies....I agree that U has maturity issues that JetBlue won''t have to address for many years to come....and a single fleet type is beyond ideal , but one has to ask , do we desire to be a "Niche Carrier"...or out Blue JetBlue? I hope our goals are better defined than trying to compare what we are to someone elses way of doing business. WN took a different path and has grown wildly...but we are going to be real sad if we try to shrink to JetBlues business mode to make a profit for a select few to enjoy.
These are just a few of the reasons jetBlue has a much lower labor expense than US Airways and the other five network carriers.
AOG-N-IT Replies....I agree Chip , the comparison begins and ends in a million different ways...So we need to fix our problems...and not by chopping out more of the work force. We need to find ways to make what we have work....and not by retreating from more markets either!!!
Best regards,
Chip
AOG-N-IT Replies....and regards to you as well "Mon-Capitan"
----------------
wings396
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I am sure that Mr. Neeleman''s salary is a tad lower as well. I saw an interview with him last year sometime, and I was impressed. He made a comment about his salary, saying that he would not take anything more than was practical for him to live on. He does have a junior workforce, but he values them and will reward them for their work in the long run. No corporate greed in his system.
I know several mechanics who jumped ship to accept positions with JetBlue. All are very impressed with their management style, they are treated with respect and their salary is equal to and in some cases a bit more than they made at U. They enjoy the fact that at Blue they are treated more like an asset than a liability. Their CEO is focused on running and expanding the company and not threatining liquidation every time something does not go his way.
oldiebutgoody
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On 6/10/2003 8:13:59 AM tug_slug wrote:
Chip,
Whats the difference in pay, work rules compensation and benefits for the Pilots at Jet Blue versus US?
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You can''t compare a company that''s only been around for a little over 3 years to US Airways, with pilots that have been here 15-30+ years.On 6/10/2003 8:13:59 AM tug_slug wrote:
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On 6/10/2003 1237 AM Chip Munn wrote:
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue''s bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
----------------
On 6/10/2003 12
37 AM Chip Munn wrote: For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue''s bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
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Chip,
Whats the difference in pay, work rules compensation and benefits for the Pilots at Jet Blue versus US?
----------------
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On 6/10/2003 1237 AM Chip Munn wrote:
For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue's bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
----------------
On 6/10/2003 12
37 AM Chip Munn wrote: For example, at jetBlue Flight Attendants clean the cabins and at US Airways you have Utility personnel, which creates another job category for pay, benefits, and retirement.
Neeleman said 70% of jetBlue's bookings are done on the internet, where at US Airways you have Rez and Travel Agents, thus US Airways has a greater number of people booking flights, thus more employee expense. Other labor cost areas are items such as US Airways employees are at TOS, whereas jetBlue has new hire entry level employees. In addition, jetBlue has a new single fleet type, where the airline has not hired mechanics to perform aircraft overhaul.
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Chip,
Whats the difference in pay, work rules compensation and benefits for the Pilots at Jet Blue versus US?
ITRADE
Veteran
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On 6/10/2003 8:23:44 AM oldiebutgoody wrote:
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Why cant you???? Both airlines have the scales, don''t they?On 6/10/2003 8:23:44 AM oldiebutgoody wrote:
You can''t compare a company that''s only been around for a little over 3 years to US Airways, with pilots that have been here 15-30+ years. ----------------
oldiebutgoody
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On 6/10/2003 8:31:59 AM ITRADE wrote:
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You can probably compare the scales, but NOT the present cost. In fact, I''ll bet that if U had any three year pilots (U''s most JUNIOR pilot has about 15 years with the company), they would make less than 3 year pilots at JetBlue, because at JetBlue 3 year pilots are Captains. All of U''s copilots are at the top of their payscale, while JB''s are near the bottom.On 6/10/2003 8:31:59 AM ITRADE wrote:
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On 6/10/2003 8:23:44 AM oldiebutgoody wrote:
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Why cant you???? Both airlines have the scales, don''t they?On 6/10/2003 8:23:44 AM oldiebutgoody wrote:
You can''t compare a company that''s only been around for a little over 3 years to US Airways, with pilots that have been here 15-30+ years. ----------------
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