Flight crew salary as percentage of a/c operating cost

[Dockjock]

Can anyone (possibly even The Guvnor) tell me the percentage of an aircraft's operating cost that goes towards flight crew (pilots) salaries? If possible- and I know its a complex problem- can we have it on an hourly basis.

I have personally come up with a figure of between 6-8% of the hourly CHARTER rate for small aircraft. Only estimating that the operating cost (total, not just direct costs) is in the range of 85% of the charter rate that gives the flight crew's pay of approximately 7-10% of the operating costs of that aircraft.

Taking into account that on a small aircraft there is usually only two crews per airframe and on larger ones usually 6+ this is getting complicated.

Cutting to the chase though, my hypothesis is that while the factors involved in operating a transport category aircraft are different from small aircraft, the flight crew pay still hovers around the middle single digits of percentage (5-9%) of an aircraft's operating cost.

So, why is it that flight crew salaries are always, almost without fail, the opening target of "cost-cutting" measures by an airline when they only make up a small portion of their total costs?

[twistedenginestarter]

I would guess 6.5% which is similar to you.

Why do they go for 6.5 and not the 93.5? Because it is not 6.5 of the costs you can do anything about it's probably 50+%. Alomost all other costs are non-negotiable.

[Intruder]

What costs are nonnegotiable?!?

The cost of the airplane can be negotiated. The cost of financing can be negotiated. The cost of insurance can be "shopped" or negotiated. Many of the maintenance costs can be negotiated.

Fuel costs can be negotiated, especially via long-term contracts.

Virtually all salaries/wages can be negotiated, including executive salaries and perks.

The costs of building rents/leases can be shopped or negotiated. So can the cost of furnishings.

Even slots and spaces at airports can be negotiated.

What's left:

Airport landing fees.

Taxes (though many of them are directly related to profits).

I think much less than 50% is "nonnegotiable"...

[twistedenginestarter]

Most of the costs you mention - capital costs (eg leasing), insurance, ground support, catering etc have been already driven down to the lowest you can get.

Employee pay is one where companies tend to pay above the minimum in order to get eg loyalty.

You can only go back to your leasing company and say "Either we re-schedule or default - you choose". Similarly is your insurance company going suddenly want to lose it's wafer-thin margin on a contract with several years to run? You have got to have a strong hand to play to get away with that.

This is why BA economise by downgrading luggage handling. They've already shaved everything else a long time ago.

Except high-salary employees...

[Sliding member]

On a similar subject, what is the cost of crew sickness and such like things. It does always appear to be "common place" during these times (as it most probably is in most lines of work) but we are proffesional????? <img src="eek.gif" border="0">
Sorry but it just annoys me during these hard times.

[Dockjock]

Well, the point I was trying to make isn't necessarily against the so-called "fixed" costs like rent, leases, fuel etc. but more on the rest of the labour side. There are a heck of alot more employees in an airline than just the pilots (obvious), but I'm not oblivious to the fact that F/A's, AME's and ticket agents are squeezed nearly as badly.

I would be curious as to so-called infrastructure (middle management) salaries and benefits as a proportion of operating costs. Pilots are made to look like primadonnas when they attempt to negotiate increases- and yet there are entire consulting industries built around studying what is the "market rate" for managers and executives so that companies can attract and keep the "talent". Not only do they happily pay market rate plus X, but also pay these consultants to give them the X figure!

There has got to be a point where an airline just says to the public, "Sorry, this is what it costs to travel 2000NM in 4 hrs- take it or leave it our employees have to eat too."