From a recent interview from Gordon Bethune, who turned Contentinal Airlines around:
"Do you know that Frank Lorenzo and Texas Air (parent of Continental) had the cheapest fares---
tore up all the labor contracts, tore up all the airplane contracts, had the lowest cost product in the industry---absolutely the lowest? What happened? They went bankrupt again in 1990. It ain't all about the low cost.
Let's say that you would reduce the cost of pizza by doing something smart like taking the cheese off? How many pizzas are you going to sell? Can you make a pizza so cheap that nobody will eat it? Can you make an airline so cheap nobody will fly it? We did it. Still went bankrupt! That's right! Came out in 1993 and almost went bankrupt again in 1995.
Why is that? Lowest costs but still a ****ty company, still a ****ty product, crummy morale. That's not the kind of airline you want to fly.
We at the same time needed to be on-time because we needed a good product.
And we needed to treat our people well. But the marketplace will decide what good is.
At the moment eJ is exploring the recipe for the pizza no one, most of all their staff, want to eat 