Why the major airlines aren't bouncing back

An interesting article in USA Today titled "why the major airlines aren't bouncing back".

As I mentioned in a recent post, uncompetitive labour costs are killing them(1), and despite all the sound and fury in the past three years, they've only closed a part of the gap with the low cost carriers.

Other factors do come in to play, like the composition of their fleets (generally older and less fuel efficient which is a killer with high oil prices) and the airports they choose to fly from (e.g. United flies from expensive and congested O'Hare while Southwest services the Chicago market via Midway) but they are less important than labour costs and in some cases, like United and American's ownership of scarce landing slots at airports like JFK and Heathrow, actually help improve their profitability.

Here's the bottom line. If the legacy carriers can fix their labour costs, they'll be around long enough to address these other issues, but if they can't it's just a matter of time before they go the way of Pan Am and TWA.

(1) I was talking about United, but it's just as true for the other majors. And yes, the Northwest mechanics (mostly men) are being just us short-sighted as the United flight attendants (mostly women) so there's no gender bias here.