<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by richard:
US may not survive, but my point is that there is one reason that the airlines are in deep do-do, and that is costs. The biggest cost is labor. And that is something Siegel addressed very well.
You can point fingers all you want at management, but the fact is that labor costs are far too high.
This relates to the disproportionate power that transportation labor unions have, due to federal legislation going back to the railroads.
Simply put, when times are good, the unions have such power that the airlines (United etc.) give them everything they ask. Then the cycle turns, and the airlines are stuck with those incredibly high costs, without the revenues to correspond.
If you take your blinders off, and stop grinding axes (to mix metaphors), you can see this.
Tilton has been far too slow to embrace the labor problem the way Siegel has. I think it is because as some pointed out, the senior execs at UA are not facing up to the problem.
Regardless, it is up to the CEO to show leadership and I do not think Tilton has.
All the cutbacks and the new SWUs and so forth are frosting on the cake. They are being done so that UA execs can say to their unions "see, we have cut back everything else, now you must give back, it is your turn now." I think this is a flawed strategy from leadership that is not leading.</font>
US just got a $900 million loan backed by the feds. The media is saying that they might get out of chp 11 soon because of the loan.
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The skies are NOT the limit, since I am going to fly them.