dbcwaar said:
Lets not forget that Value jet purchasing Airtran and then adopting their name to spin the DC-9 crash they had into the everglades, or America West's being fined for 41 thousand safety violations back in 1998! I believe this was the largest fine in FAA history at around 5 million.. If I recall they were not securing luggage in their plans and had some various other safety issues...
http://www.wsws.org/workers/1998/july1998/air-j16.shtml
AWA had significant operational problems around 1998, but again, I'd say that's an example of where the mgt focused on fixing the operational issues, and that has helped them maintain/improve their cost position, not caused them to become high cost. As much as the network changes and new pricing structure, the turnaround in their operations has been a major part of the reason for their survival. (Any one want to crunch the Mx costs per seat mile or some similar metric between 98 and now for AirTran?)
Just because a supplier is shoddy and cheap (sticker price for the service), doesn't mean it's low cost (total cost of outsourcing the work). I bet SW is looking at the cost of oversight and rework (as well as safety risk) and deciding they can do the work better
and cheaper in house when they are insourcing the work. In fact, when you cite SW as an example, it proves the point -- you can be focussed on being low cost and maintain focus on safety at the same time. Local12 -- you can't have it both ways. Or are you claiming that Southwest has suddenly lost it's focus on cost control?
When looking at outsourcing (any industry) you have to look at total cost of the outsourced work, including contract mgt, oversight, rework (if there are quality issues), costs of disruption to schedulke if rework is required, and the potentially huge costs of poor work causing a safety issue or, God forbid, an accident.
Local12 -- I'm not disagreeing in any way with what you have seen first hand. But just as LH Technik and Haeco do high quality work, others will see the need for quality work and offering lower total cost -- not just a cheaper sticker price and shoddy work (as discussed on several threads -- e.g., ST MAE). Just because Local12 you've worked in a low-cost shop and found it to be poor quality, I wouldn't put all 3rd party suppliers (at whatever price point) in the same bucket, which is what you are doing.
Mx gets particularly emotive because of the very real safety concerns. But just as jetBlue and Virgin have shown that you can deliver a higher quality service for coach or biz class passengers at lower cost, just as Toyota and Honda showed that you don't need to buy a $40,000 car to get quality and reliability, the Mx providers that survive and succeed, long-term (in-house, OEM, or 3rd party) will be those that work out how deliver high quality at lower costs. Is it difficult, yes? Can cost cutting lead to decisions that impact safety if not thought through, yes. Does that mean it can't be done (high quality, high safety, high productivity, lower cost)? No -- it absolutely can be.
767jetz: your last post, summarized, says you cannot have universal service and low fares, so re-regulate. I.e., the public is wrong, government knows better. Lots of companies have said that this or that, demanded by consumer, can't be done, and have gone to the wall. It may cause a lot of change in the process, but the companies in any industry that win are those that decide it can be done, and focus on figuring out how to do it, rather than claiming it can't be done. No-one thought you could get a package overnight from any point A in the US to any point B in the US overnight, but FedEx saw the demand for that (and UPS (I'm guessing), USPS (certainly) all existed at the time) and figured out how to do it.
I think that's the fundamental debate on this board. Those who believe that something can be done (even if it's bloody diffcult and few do it well now) and those who have just decided it can't be done. It just so happens, the focus is heavy Mx, but it could be anything with a price tag.
