Monday, April 14, 2008
Inside American Airlines: A Week in the Life
I caught this program on CNBC on Sunday night and highly recommend it to anyone interested in the airline industry and/or the economics of managing an airline. It's narrated by Paul Greenberg and he does a decent job examining the industry via American Airlines in areas like logistics (baggage, travelers, fleet, and cargo), fuel costs, passenger safety (post 9/11), and maintenance.
The segment on rewards (frequent flier miles) will make you angry, especially now since AA is charging $10 to cover the variable cost of your seat. What I found most fascinating is how little profit the airline makes on each flight. As a result, the airline is incentivized to keep those planes full and off the tarmac. At one point in the program, Greenberg shows a slide that shows how many flights between LAX, JFK and BDA one airliner must make in one week/month to reach maximum profitability.
One other comment...I thought the CEO seemed a bit smarmy.
***BONUS***
You know that joke you like about the monkey and the sailor? JACK IT to Celine Dion with our NEW headphones
The segment on rewards (frequent flier miles) will make you angry, especially now since AA is charging $10 to cover the variable cost of your seat. What I found most fascinating is how little profit the airline makes on each flight. As a result, the airline is incentivized to keep those planes full and off the tarmac. At one point in the program, Greenberg shows a slide that shows how many flights between LAX, JFK and BDA one airliner must make in one week/month to reach maximum profitability.
One other comment...I thought the CEO seemed a bit smarmy.
***BONUS***
You know that joke you like about the monkey and the sailor? JACK IT to Celine Dion with our NEW headphones
Labels: airlines, airports, business, economics
