"Who is flying your airplane?"

[AirRabbit]

The situation today is pretty much as it has been forever. An airline has (generally) one source of income – ticket sales; and they have a multitude of things that cost – airplanes (whether purchased or leased), spare parts, fuel, landing fees, airport rental costs … and, likely, the largest cost, salaries. I know of no airline that went into business for any altruistic reason – the betterment of man, provision for safer, greater, and cheaper transportation for the masses, and so forth. Airlines are just like any other business – they’re in business for the same reason any other business is in business – to make money. Is that such a bad thing?

I can’t speak for the rest of the world, but in the US, the airline business used to be able to rely on the government to essentially ensure their success. The Civil Aeronautics Board (CAB) had three main functions: to award routes to airlines, to limit the entry of air carriers into new markets, and to regulate fares for passengers. Therefore, when an airline experienced additional costs – like a hike in fuel costs, additional labor costs, etc. – they would go to the government seeking approval for a ticket cost increase. Sometimes they got it … sometimes they didn’t. The market didn’t drive many (if any) aspects of the airline business. Through the 1960s and into the early 1970s, for people who wanted to buy a ticket on an airline to go from point A to point B, it almost didn’t matter what airline they chose, because the price was almost identical between those two points – as that price was regulated by the government. Airlines couldn't change their route structure without permission. They couldn't add route segments or delete route segments without that approval. During this time the industry saw exploding growth patterns but, in the middle 1970s, economic conditions began to change – inflation started up, the growth of the economy took a down-turn, productivity declined, and labor costs continued to rise – not to mention that fuel costs were just beginning to respond to these same effects. The steady increase in public air travel was generating an increasing complexity level and the government found it increasingly problematic to both understand and fairly (and accurately) maintain controls on the industry. This resulted in the 1978 Airline Deregulation Act – which dismantled the process of setting fares and limiting competition – however, the safety regulation was not changed.

So what has been the impact? Airline ticket prices have declined – almost 40% (after adjusting for inflation factors). What about safety? Has it fallen the same way? NO. It has continued to improve. By any measure, the safety record, around the world and certainly in the US is now at its best position in history. I’ll let someone else comment on the level of service and impact on ground transportation issues – all serious issues, but not in my area of expertise, necessarily, and not really germane to the topic at hand.

The concern I have is that I believe a lot of the credit for the safety improvements has been due, in at least some large part, to the reliability of the equipment used (airplanes, engines, systems, and avionics). At the same time, up until recently, those who continued to seek flying jobs have had a fluctuating level of experience and qualifications. A good share of the US airline pilot population for a 15-year period was largely provided by ex-military pilots. This availability doesn’t exist at the same levels now. So, the issue that has developed is … how are the applicants for the flying jobs that are available going to get the training, experience, and qualifications that are necessary (by someone’s estimation, anyway)? And the talk now is that 250 hours, a CPL w/ IR and ME, is not sufficient … and many are flocking to the thought that requiring an ATPC will solve those problems. Will it? How much can an airline afford to spend on training its new pilots? Of course it would be a lot better for them to be able to hire those with several thousand hours of heavy, multi-engine jet time … but, where are those folks? Unfortunately, they don’t exist at the moment. So, what to do? Do those airlines take a person with 250 hours, a CPL, IR, and ME, and train them in 6 weeks on the CRJ (4.5 weeks of ground school and 1.5 weeks in a CRJ simulator) and expect the result to be a qualified airline first officer? Or, do those airlines take a 1500 hour pilot with an ATPC in a C-152, and give that pilot the same 6-week training course on the CRJ? Will the result be substantially different? Where is the control of this new pilot applicant’s background and experience? Will there be enough “off the street” applicants to meet the requirements? Will the airlines have to “beef-up” the CRJ training? Should they double that training - to 12 weeks (9 weeks of ground school and 3 weeks in a CRJ simulator?

Who are these pilot applicants? Where did they come from? So ... the salary that the smaller airlines are offering is not spectacular. Whose fault is that? Should the government step back in and re-regulate – thereby attempting to ensure the company’s success? Without ensuring the other end of the “money pipe,” I doubt that this will work. So, that means going back to the government setting airline ticket prices that will guarantee a profit for the airline after meeting all the newly mandated training requirements for its new-hire pilots. How will the traveling public view this “new” ticket pricing scheme? How effective do you think any industry will be when it is under the direct and continuing regulation of the government? Will such an effort require government subsidies? Where would that money come from? The point is, airline managers today are free to offer salaries that they believe they are capable of meeting while ensuring a satisfactory profit for the company. Sure – you can disagree with those managers’ position on what “satisfactory” really is – but it IS their company – not yours. As long as the airline industry is under a free market control – an individual airline will not be able to increase its ticket prices substantially above that of its competitors – or they risk losing their market share. Lowering the ticket price narrows their profit margin without making associated cuts in their costs – training is a cost – among a lot of other things – including salaries.

Please, don’t misunderstand my comments. I don’t have the answer. I assure you that if I did, I wouldn’t be reading and writing these posts … I’d be on lounge chair, enjoying the warmth of some sun-drenched beach with a tall, cool one in my hand awaiting the motor launch to take me back out to my yacht.