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Old 12th Nov 2012, 00:26
  #9 (permalink)  
jackx123
 
Join Date: Jun 2010
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15% cut will not be enough. A quick and dirty below.

All cost being the same across the industry. i.e. lease, fuel, interest, landing fees etc, the single highest cost is labour.

There is better data from SH&E or BCG, but this one is easy to read
Where your airfare really goes - Fortune on CNNMoney.com

Labour cost taken from eurostat (or European Commission).
Eurostat Home

Denmark is roughly 40% higher than Sweden and Norway is roughly 30% higher than Sweden.

Compare this to e.g. Poland, which has a highly qualified labour force, and has less than half of Sweden's labour cost. Even Germany has lower labour cost than Sweden.

So, comparatively, roughly 30% of your entire cost is halved in case of LOT, giving more room for fleet renewal and better fuel economy, better customer service (and satisfaction) and thereby can compete more effectively.

This very simple calculation should be easy enough to follow even for the unions.
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