The April 2 Business article "War, Fear of New Illness Add to Airline Problems" said that airlines need to reduce "their labor costs, infrastructure and fleets to improve their ability to compete with low-cost carriers such as Southwest."
Southwest Airlines is a great company with a good product, but it cannot be held up as the model for the industry. The major airlines compete with Southwest only in limited markets. Southwest serves a niche market of dollar-conscious travelers who don't mind short hops, tight quarters, no service to many major airports and no service outside the lower 48 states. The Southwest model simply doesn't accommodate travelers who must travel long and far and need room to stretch out to work or rest.
Southwest also flies only one type of aircraft, which results in lower costs for training, maintenance and other areas. But when a customer wants to fly from Allentown to Hong Kong, Southwest can't do that. Southwest also stays away from the major hub airports, which doesn't work for customers who want to fly to Reagan National instead of BWI, or San Francisco instead of Oakland.
Expecting the rest of the airline industry to model itself after Southwest makes as much sense as expecting the restaurant industry to model itself after McDonald's. Nothing wrong with McDonald's, but not everyone wants fast food. Even those who do sometimes want or need something else.
The story "War, Fear of New Illness Add to Airline Problems" quoted "experts" who tried to minimize the importance of the airline industry to our economy. One said government assistance "would do only harm." Another suggested that airline troubles have little effect on the economy.
Contrary to these opinions, the airline industry's direct and ripple effects on the nation's economy have been estimated to total $900 billion, representing 9 percent of gross domestic product. When airlines stagnate, aircraft and engine manufacturers feel it, as do airport vendors, rental car companies, hotels, resorts and so on. Carriers being forced to retrench will drop service to their least-profitable cities.
The major airlines know they must restructure to get back to profitability. US Airways, American and United, representing half the industry, have worked through plans with their labor groups to slash billions of dollars in costs. Other major airlines will follow to remain competitive.
But losses continue to mount. The Iraq war and the SARS outbreak are just the latest causes of decreased air traffic. Suggestions that this industry is not important to our economy are wrong, and assistance from Congress to help defray the billions of dollars in costs imposed on this industry in the name of national security is hardly a bailout.
J. RANDOLPH BABBITT
The writer is president of an aviation consulting firm.