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How would you "encourage US domestic carriers to change the way they operate so that they can match the Norwegian fares while retaining American jobs." I think
by _acme 9y ago
How would you "encourage US domestic carriers to change the way they operate so that they can match the Norwegian fares while retaining American jobs." I think the point is that that is impossible.
- davidf18 9y agoI don't agree. The consolidation of major carriers under Obama administration (United buying Continental, and American buying US Air) has reduced competition and thus higher fares, worse service. They don't fly out of regional airports at least in NYC I think that is rare. I"ll bet there are a lot of operational issues. Delta, United and others own low-cost carriers (the famous United case where the senior was dragged off the plane screaming and kicking was not on United but a low cost fully owned subsidiary carrier of United) as it is, so they could have a low-cost carrier that travels to Europe. These low-cost wholly owned carriers are domestic only. But none of them have them because they want to cannibalize the higher fares charged. They enjoy their margins. Norwegian (like Amazon, like Uber) is in a contest to capture market share and thus may be willing to operate on thin margins or even take a short term loss to capture share. The major American carriers may not want to invest the money to retain share and prefer to use politics instead.
- saryant 9y ago> the famous United case where the senior was dragged off the plane screaming and kicking was not on United but a low cost fully owned subsidiary carrier of United United does not own Republic Airways and they are not a subsidiary of United Continental Holdings (United's parent). Republic is its own airline operating flights under contract for United, Delta and American. The legacies by and large do not own the regional carriers, nor are those airlines intended to be low-cost carriers. The differences primarily lie in the aircraft operated and result from union contracts that inhibit the legacies from profitably operating smaller (non-mainline) aircraft.
- davidf18 9y agoAccording to Wikipedia, United Continental Holdings is the parent of United Express: https://en.wikipedia.org/wiki/United_Express https://en.wikipedia.org/wiki/United_Express > "and result from union contracts that inhibit the legacies from profitably operating smaller (non-mainline) aircraft." And it is these union contracts then that keep the US carriers from earning such low profits.
- saryant 9y agoUnited Express doesn't operate flights themselves. They own no aircraft and employ no flight crews. They contract out all operations to carriers like Republic. United Express is nothing more than a brand serving as an umbrella for a group of subcontractors.
- davidf18 9y agoUnited seems to have some operational control since the CEO of United said that they would no longer be dragging people off of flights and in the media that passenger was listed as being on a "United Express" flight. These subcontractors seems to run with lower operational expenses and yet use Americans as pilots following FAA guidelines. United could have a similar arrangement with lower operational costs for overseas flights.
- coredog64 9y agoIn good years, airlines have some of the lowest profit margins of any industry. Maybe instead of allowing a bunch of crappy carriers to come and go, it would be better to allow consolidation into a few majors. Ticket prices might be somewhat higher, but they would still be more affordable than they were when the industry was fully regulated.
- davidf18 9y agoEasyJet, Ryan Air, and Norwegian are not crappy carriers that come and go. Low profit margins have to do with an industry that by-and-large is a commodity. But prices have to do with operating costs and Norwegian and Ryan Air and Easy Jet have done a better job of controlling their operating costs than US carriers.