Wednesday, May 16, 2012

Something missing from the SWA/UA debate

You don't see this factoid in any of the Houston media coverage on the matter:

Southwest postpones orders for 30 Boeing 737's. Seattle Times via Chicago Tribune.

The larger U.S. legacy airlines have cut their labor costs below Southwest's, threatening the Texas airline's status as a low-cost carrier
If you need to know why the "Southwest Effect" is no longer in play, that blurb should tell you all you need to know.

What we really need is a meaningful, third party study performed without interference from the two airlines in question.  Will we get that?  I'm not banking on it.  Until then, remember this when Southwest talks about how much cheaper their flights are going to be.  On labor costs, they are losing out and they don't have those fuel hedges to fall back on any longer......

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