Delta and United have reported losses on the back of airline pilot salary increases and looking forward, they appear to be unsustainable.
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United, Delta Earnings Report Losses
Two of the nation’s largest carriers reported losses this quarter despite very full planes and very high fares. We begin with Delta.
“Delta posted a net loss of $363 million, or 57 cents per share, citing, in part, a new, four-year pilot contract that includes 34% raises. That’s still an improvement from the year-ago period, when travel demand was still recovering and the company reported a net loss of $940 million, or $1.48 per share.
Adjusting for one-time items, the company reported net income of $163 million, or 25 cents per share, up from a loss of $748 million, or $1.23 per share, during the first quarter of 2022.” – CNBC
Included in those numbers was a staggering 16% operating margin on flights and $1.7bn from co-brand partner, American Express. Most loyalty programs run at 50% margin or better. Delta reports that corporate bookings have returned to 85% of 2019 levels (a shocker to me.)
United Airlines also gave downward guidance on its quarterly earning despite an ideal condition for earnings on the back of a new pilot agreement.
“The Company has determined that it is appropriate to accrue expense in the first quarter 2023 related to a potential new collective bargaining agreement with employees represented by the Air Line Pilots Association,” the filing said.
The airline’s statement said it expected unit revenue to be higher than in the corresponding months in 2019. Lower demand months such as January and February grew less in 2013 than it anticipates for higher demand months.” – The Street
Airline Pilot Salary Increases
Some American Airlines pilots will earn as much as $590,000/year under the new proposed contract. While that will require years of experience and will only be available for those with the most flight experience, type of aircraft, and time with the airline. The Bureau of Labor Statistics website was inoperable at the time of writing, but according to Indeed, the job listing website, the average cardiologist makes $435,000/year. Both jobs place lives in the professionals’ hands, both require experience to achieve and lots of money. The average airline pilot’s salary across the board is still far less than these figures, but absorbing over half a million dollars a year will be costly.
We’ve covered the pilot shortage in depth over the last few years here on Live And Let’s Fly. The root cause of this is an arbitrary 1500-hour requirement for commercial airline pilot type ratings in the United States coupled with the exceedingly high cost of receiving an airline transport pilot (ATP) certificate, accruing hours, and flight training. Additionally, fresh-out-of-school airline pilots received a very low hourly rate from regional carriers (as low as $18/hour) reduced the ability for First Officers to pursue pilot training out of near minimum wages strapped with $70-150k in student loan debt.
The invisible hand of the market would suggest that the market rate for a limited (and shrinking) number of available professionals is determining the wage of these pilots. International pilot salaries (especially those in the Middle East) have grown but not to the same level.
Future Setbacks Could Cripple Airlines
As United stated, it’s already pricing in the expected elevated costs to prepare investors and adjust for the future. Delta is marking some of that increase as a one-off cost. However, both airlines continue to forecast a banner year for travel. Delta indicated that future bookings were some of the highest levels it had ever seen.
Forget a market-wide recession, who knows if and when that will happen and what sectors of the economy will be deepest affected. At some point, the current run of increased demand is likely to slow. If airlines are struggling to make profits at record booking levels with high fares, what happens when that demand drops off?
Let’s take an example of a flight like Dallas-Hong Kong, a former favorite of mine when I was an American Airlines loyalist. That flight would feature no fewer than three pilots (perhaps four) all at the top earning level. That will nearly double the pilot cost for the (then) daily flight that already combats extensive parking time on the ground in between flights.
United is forecasting a 9% margin for the year, how much does demand have to drop before that’s suddenly a negative number? If demand drops, fares would initially drop too to capture market share, expediting a race to the bottom whereby labor costs are unsustainable.
The pilot shortage is real, it’s here, and airlines are paying big bucks for great pilots. However, these levels seem unsustainable outside of what is likely to be a limited boom. While this solves an immediate demand issue, my fear is that it leads to layoffs, or high fares for longer whenever demand subsides. The alternative is that true long-haul point-to-point goes away and is ceded to foreign partners that can carry passengers onward to their destinations. Flights to Australia that were non-stop add a connection in Tokyo, Taipei, or Beijing for example, to reduce costs for US carriers and keep fares low for US consumers. That’s bad for pilots too.
What do you think? Are pilot salaries sustainable? What will happen with market fluctuations?
Pilots are greedy and will likely bankrupt airlines again. It’s very unfortunate.
CEO pay needs to be increased to solve this issue.
If there are no contingencies or business continuity plans in place to to prevent one workgroup from bankrupting a company then it sounds like a management issue to me.
PLEASE, LETS BE REAL..AS A 30 YR RETIREE OF 1 OF THE BIG 3 IN THE US..ROUTES SUCH AS CHICAGO /HONG KONG OR BEIJING..THE AIRLINE PACKS THE CARGO HOLD OF 787 ,777 OR 767 ER WITH 3 TO 5 MILLION IN JUST FREIGHT CARGO..THE PASS MONEY IS USED TO PAY COVER EXPENSES LIKE LABOR FUEL AND AIRPORT FEES..WE RAN THOSE ROUTES 12 TO 14 TIMES PER WEEK..THAT PAYS ALOT OF SALARIES.
Why are you yelling, you moron?
Interesting there has not been a mention of this administrations war on fossil fuels that are ultimately driving fares up. United has also been reporting record profits while they can not agree on a new collective bargaining agreement with the pilots union. But, once again, let’s give ole Joe a pass for destroying America. All of you businesspeople get back to your “how to be woke” handbooks. HR will be administering a test at the end of the day.
I really don’t care whether the airlines make any money. I hope that foolish investors keep dumping their money into them, allowing us to travel so much more affordably than in the past.
Thank you! This is obvious from these earnings and AA stating they won’t make numbers. All of us flying see full flights, higher prices and streamlined operations. And miles/points being worth less than ever.
Fuel isn’t as high as the last 2 years so what is the problem? You hit it, it’s the pilots. The problem is there is no going back with the salaries being offered.
Long term it’s hard to see airlines being profitable as prices can only go up so much. Are we looking at the long term liberal goal of government ownership?
Certainly not a good time to be investing in airline stocks.
As someone that’s in the aviation industry and was close to becoming an airline pilot but took a different route I totally understand like most that these salaries aren’t sustainable long term. I got all my flight ratings and degree in 2002. A time period just after September 11th when airlines laying off left and right and cutting salaries. Anyone seriously in that aviation industry should know that it is very cyclical and dependent on how the country is doing a whole.
The airlines are desperate for pilots know because there were too many barriers that dried up their pipeline of newer pilots. It is very expensive. Then you have to build time to get to a certain point before the big boys like DELTA and American would ever look at you. The regionals airlines were paying pilots 20 grand or less a year. A lot of people that wanted to be pilots turn their heads and went elsewhere careerwise.
Well now travel has turned around drastically since the pandemic. Too many senior pilots retired during the pandemic and the airlines are struggling to fill copits with qualified pilots. The unions know this and thus are making airlines pay up while they can make demands. I’m sure the unions leaders and pilots know that these wages are not sustainable long term. The day will come when management of all the airlines will say either we cut your wages or we will all be on the street. But that time isn’t here yet. So the unions are getting the most they can for their pilots in the meantime knowing that the day of reckoning will eventually come. That’s how things always go in this industry. I am happy for all my friends that are finally flying the big jets for American, DELTA, and United. They have been working their butts off to get their and deserve every penny they can get while times are good. They are not spending like drunken sailors cause they know that good times don’t last forever.
To the writer and you Dave, are you really so uninformed as to NOT a know the pilots at United and American Airlines are still in negotiations for contracts that are from 5 years ago ? So either you are tools of management or simply a tool. I can NOT believe you would write an article or comment in such a manner when the pilots have not received a single penny raise in over 5 years. In fairness the Delta pilots did sign their new contract last month so yes once they get it all implemented the cost should go up. I am really holding back but the ignorance of society is simply stunning.
As the linked article states, “American is pricing in the contract increases.” So whether the deal is done or not (you’re correct, United and American have not closed), the airline is assuming financials as if it is done now. American has even stated it’s spreading those adjustments out over three years including the upcoming quarter despite not having a deal done. So whether the ink is dry or not, they are taking those costs as if they are and can’t make it work at least in the case of United and Delta with American yet to report.
And United said the same thing – it explains why it took a Q1 loss.
So Kyle, let me get this straight, you are applauding a CFO of Fortune 100 company for expensing of a NON-EXISTENT contract that has been being negotiated for 5 years and was preliminarily agreed to 1 year ago but failed ratification. Then the CFO and CEO on an earnings call then make a claim the NON-EXISTENT contract is unsustainable in the future and they decided to start expensing it in the first quarter of this year to affect first quarter earnings. So, if you are a smart CFO and were so concerned why didn’t you start expensing either a little at a time for the last 5 years or more realistic when there was TA one year ago ? Sounds like a not so smart CFO if the pilot contract matters, I would fire the guy for letting the cost sneak up on us.
You are so getting played its truly sad. Do you think Scott Kirbys and other execs stock options that were exercised in the first quarter pricing had anything to do with ? That’s a rhetorical question since the answer is obvious to most.
Why don’t you bloggers just stay on the sidelines while the pros do their work. You may know about miles and upgrades but you are absolutely clueless when it comes to financials, airline ops, unions and how LR manipulates you bloggers.
P.S. Since its clear to us all you are jealous of the pilots, you are not to old to start flight school. It just requires lots of time, money and sacrifice. That’s why very few people can do the job.
@30West – I would love to complete my pilot’s license and I am unequivocally jealous of pilots that get to climb the skies all day long and though I began my lessons as a teen, I was self-funded and appreciate the sacrifice it takes (both in time, cost, and delayed earnings) to achieve that high goal.
The rest of your assumptions are incorrect. To your first point, I am not applauding the deal nor those who made them on any side of the table at any airline. Pilots will not be happy if they are furloughed or laid off or their agreements destroyed in bankruptcy courts because they seem great at a time when travel is at an all-time peak. Negotiating for five years, yes, but at these pay levels – not even close. It’s no wonder they are being expedited now that rates have reached nosebleed high levels.
I don’t have much faith in Scott Kirby based on his prior performance at American in dismantling what was becoming an excellent airline. I haven’t seen anything at United that has changed my mind and I am frankly baffled as to where you’d find me patting him on the back for… anything.
While I may be clueless about airline operations (I’d dispute that but I have never worked at an airline so let’s go with it), I do hold several advanced degrees in business and remember, the post is about whether a deal that forces a loss in the best possible situation (maximum occupancy, maximum fares) will somehow turn to a profit if ANY of those parameters change. Let’s change the parameters up a little bit. Let’s pretend that coffee becomes the drink of choice for the foreseeable future, there are lines wrapped around every coffee shop. Overworked baristas are in short supply and leaving the business. Baristas that stay get locked in to a $100/hour rate for seemingly every available barista in the country and for a term of several years. A Frappucino soars to $15 but people keep coming in. Yet despite this the coffees shops are still losing money. Then, one day, either consumers can’t afford it or demand subsides for some reason. Coffee shops are still held to honoring the $100/hour rate for all of the baristas, but there are no more lines out the door, and $15 blended coffee is no longer flying off the shelf. If they weren’t making money when there were lines around the building, how will they make money now?
That’s all this article is about.
You realize that airlines have almost never turned a profit in the first quarter, right? This has been true even when pilot contract values were at historic lows after the bankruptcy era, during which heavy handed management tactics imposed pay cuts upwards of 50%, and also included devastating work rule changes and termination of pension plans. Even after Deltas new contract, salaries lag inflation by 20+% since 2000.
Todays pilot hiring environment had its seeds planted back then. Not unlike the surgeon mentioned many times who takes 10-15 years to reach their career goals, pilots who would naturally have accumulated the experience to fly for a major airline by today would have begun their journey right during the depths of the bankruptcy induced pilot contracts of the late 2000s. Many aspiring pilots chose different careers due to the horrific pathway through bottom feeder regional airlines that was required to become a major airline pilot, with the eventual payback being seemingly non existent after bankruptcy imposed contracts at the majors.
This era disrupted the pilot pipeline in ways that the blogger class, RAA, and airline management types have never been able to comprehend.
You reap what you sow, and it takes a significant amount of time to undo the damage caused by the bankruptcy era, to include sharp upswings in the value of a pilot while awaiting the return to market equilibrium.
A lot of what you’ve mentioned we have covered elsewhere on this blog in dozens of posts over the years, but one point I want to address is that you don’t mention what happens if travel slows at all. Delta, and United have both forecasted profit this year (Delta $2bn for example) but regardless of a general easing of travel spend which all business logic says has to happen at some point, and ignoring the risk of a broader recession, tech layoffs alone will have to catch up with airlines and hotels soon. I don’t see any room for those potential slowdowns in the numbers I have seen. It’s less about Q1 never being profitable for airlines and more about what they will do should there be a hiccup along the way.
I haven’t looked much but Envoy is currently offering a day zero $75k bonus to any incoming pilot with between 500-949 flight hours. Pretty good incentive to quickly pay down any flight school cost…
Piedmont did $100k along with practically doubling first year pay..not too shabby at the regionals these days..for pilots.
Yet airlines continue to fly to fewer and fewer Essential Air Service cities. Could the two be related?
Yes, could be but at the same time we need to check profits because a lot of the inflation narrative is really corporate greed in disguise.
Illegal Corporate Price-Fixing’ Is Rampant in US Economy: Report
“Large corporations which are supposed to be competing with one another are often secretly conspiring to set prices,” said one expert. “In doing so, they cause economic harm to consumers and contribute to inflation.”
Skywest, which by far flies the most EAS routes announced their big cutbacks months before regional airlines pilot wages started to spike.
Most of these routes were doomed anyway by the long planned retirements of the 50-passenger jets.
I quit at 54 from a major US global carrier because the salary wasn’t enough. Seattle garbage truck drivers were making more.
When you can’t get a flight because of the pilot shortage (many, many planes are already parked) management may rethink wages.
Did you start at SkyWest at age 53?
Ummm…no. At AA there would be one captain, making top $$, then 3 F/Os making less $$. They would be at the top earning level (possibly unless they had less than 12 years with the airline) for their seat seniority. They’re not all making $560K.
I’ll start by saying pilots absolutely deserve to be well-paid but the current trends are obscene. Unions are forcing one-upsmanship between airlines with little-to-no regard for the long term sustainability of the organizations that write those checks. Most pilots care about two things; how much they make, and how much their buddy at Airline B makes. The industry is in serious trouble if this level of greed sticks around.
pilots should be considered exempt employees and given stock options instead of high pay. At these wages they need to share the company’s success or failure.
The pandemic rebound is short lived. Everyone that was traveling on their credit cards is just about tapped out. Also, when student loan payments kick in again, 37 million people won’t be able to afford vacations.
A pilot often has a bachelor’s degree. The article states $70-150k in student loans. The article states pay at $590k for those with a lot of experience.
A cardiothoracic surgeon also has a bachelor’s degree. However, after that, the surgeon might need 14years of additional training (4 years medical school, 7 years general surgery, 3 years cardiothoracic fellowship). So the surgeon is 14 years behind and also $150k/year behind.
Optometrists call themselves “doctor” but they are fake doctors. In the UK, they are called “Mr.” or “Ms.” or “Miss” or “Mrs.”. Optometrists are lobbying state legislatures very hard to get to do things that doctors do.
You actually don’t need a bachelor’s degree to be a pilot anymore. Most airlines have gotten rid of this requirement in recent years.
I thought in the UK a male cardiothoracic surgeon was called “Mr” t00…
As for the part about 14 years of education after the bachelor’s degree– 10 of the years in your example would be paid at the $60-100k/yr rate presently, which the pre-COVID years, seemed somewhat analogous to the kinds of salaries pilots were getting in the early years of their careers.
Right now is a great time to be a pilot in terms of earning, other times haven’t been so kind. Comparing pilots to doctors, I’m not sure what it even proves– if pilots are paid more is that some sort of perversion of the law of nature? My guess is that pilots are paid more than doctors in the majority of the developed world. However if that comparison is going to be made, using the best wage market for pilots in recent memory and comparing it to what is certainly not the best wage market for US physicians is at the very least a distorted comparison.
4 pilots on an international route that you mentioned are not all making the highest salary. That’s typically flown by 1 Captain and 3 First Officers. The cost for those 4 pilots to operate that flight will be paid by 2-3 revenue passengers, particularly those in business or first class. Interesting that those airlines you mentioned are handing out millions in bonuses to senior executives, but they can afford that?
Two wrongs don’t make a right. I don’t understand why the flawed (and in my opinion obscene) executive compensation packages somehow JUSTIFY the inflation-spurring pay for pilots? He robbed a bank so I can too?
Let’s say they are robbing the bank. Why then is management allowing them to rob the bank by agreeing to these contracts? What’s worse: robbing the bank or robbing the bank with management approval? Overall this all seems odd to me. I know they need the qualified bodies to fly the planes but I do continue to wonder if we will always have the big three or not. Are we looking at “The Big Short” of airlines? I hope not, but I also hope someone with a higher pay grade is considering all scenarios.
Matt/Kyle, please go write an article titled “Airline Executive Salaries are Unsustainable” and highlight United CEO’s recent windfall of $6M and the UAL President who was awarded a $4M bonus last year after less than year in the job and whose payout schedule was engineered specifically to avoid the post-Covid regulations on airline executive pay.
If you and Kyle going to write about airline industry financials and make broad-based claims, paint he whole picture, not just part of it.
Makes one wonder what airline executives spurred the writing of this article and the suggestively selective title…
United is set to earn, by their prediction, $10-12 PER SHAR for full year 2023…that’s their estimate. That’s over ~$2 Billion. Deltas forecast WITH the highest pilot contract out there is $6 PER share, or ~4 billion 2023 earlnings. Even with a new contract, there’s plenty of money to go around at the moment, hardly close to bankrupting, very irresponsible article.
And may I add, airlines have had zero problems asking for pay cuts to avoid chapter 11, in 2001, and in 2007 almost all major airlines got cuts from theses same “greedy” pilots. Think a little and do so research before writing this crap.
How much do you think a pilot needs to make?
How much do you make Pro golfer, MLB, NBA. How much is too much? It is irrelevant what I think they should be paid.
Irrelevant in what sense? I’m not talking about any legal or even moral argument. I was just curious. That makes it relevant.
Why does what YOU think anyone should make matter one bit? I don’t know what you do for a living, but based on your comments on this page, I assume you’re paid well above your worth. But fortunately, I don’t get to decide what someone else makes. Your employer and the market decide. That’s how a free market works. An airline not willing to pay for talented, experienced pilots will soon suffer from lack of recruiting and an exodus of their pilots. Perhaps the market will slow down, demand will decrease, profits will turn negative, and airlines will declare bankruptcy. That’s how the business cycle works. Or perhaps the increasing pilot wages will attract more people to the field and the airlines will find their current wage structure is sustainable. Again, that’s how the market works. It certainly doesn’t need someone deciding an employee “needs to make”.
@Jesticles – “The invisible hand of the market would suggest that the market rate for a limited (and shrinking) number of available professionals is determining the wage of these pilots. International pilot salaries (especially those in the Middle East) have grown but not to the same level.” It’s in the post.
Yeah, that’s not my point. I agree with your general point. I asked a specific and personal question. This isn’t about what the market will pay. I’m just curious what pilots think their time is worth.
Unless you’re a shareholder. My only point is that if they can’t make money now, they can’t possibly dream of making money when optimal conditions deteriorate which they inevitably will. Do I care what a private CEO makes? No. Do I care what Steph Curry makes? I do not. But a publicly traded commercial airline is neither of those things.
Airlines rarely make a Q1 profit. In 2016 AA only turned a profit on 56 days out of the entire year. 35 of this were between June 1st and August 1st. Delta’s new pilot contract doesn’t even match inflation adjusted rates of their year 2000 contract. My best assessment is you have waded into an area you know little to nothing about.
@Matthew KK – “Prediction”, “estimate” are key terms. Further, Delta is also pointing to the highest-ever future bookings for the busy summer season (also included in the post) but that doesn’t mean it will hold for the year. Further, I am not arguing that airlines don’t have enough money to go around and also point to Delta’s $1.7bn earnings in the same quarter from a massive profit center (American Express.) I’d agree that airlines could probably make more money but the facts – not ideals – are that they are not making profits now and the conditions could not be better.
I never once called pilots greedy, there’s plenty of research and support – you just don’t like it.
Talk about Journalistically lazy! Q1 is the optimal time to make money?? In the airlines? It’s always the slowest quarter, the lowest revenue of any quarter. Next, the AA and UAL contracts aren’t done yet. And you blame their pilots? It’s the Regional pilot salary bump that has cost the most money, not the mainline pilots.
Oil costs have increased lately due to the war in Eastern Europe, which doesn’t help. But only one mainline carrier has completed a new contract, and you neglected to point out with vigor that the main reason for the Q1 loss was due to a ONE TIME charge due to back pay for the mainline pilots. Back pay is normal in late contracts, and if you weren’t late, you wouldn’t have to have a large bill at the completion.
You barely bring up the ancillary revenue streams at the Majors. They usually have a credit card deal, and even Delta has an oil refinery that does very well during high oil times. (Now). You may want to read this article in Skift magazine: “Delta Expects to Make $7 Billion From Its Amex Credit Card Relationship by 2023. But How? Brian Sumers, Skift “
Looks like some airlines will be profitable without carrying passengers. Then throw in bag fees, other fees, etc. Lots of new revenue that wasn’t available 10 years ago. Your future prognostications fail to include any of those.
For the 100th time in these comments, I will say it again: United factored in the contracts into its financials as if the deal is done. They absorbed the expected cost before the contract was signed. That was their choice and their explanation not my extrapolation.
Let’s look at that $100MM one-time pay out, the airline lost $700MM.
Oil prices always fluctuate, that’s part of the business but there’s hedging and everything else. Executives did not point to oil costs, however, as the cause of their loss.
You mention ancillary revenue and I am quite clear in the post that the airline earned $1.7bn (and noted that the margin is rather remarkable on that revenue) during the period. Perhaps you missed that.
You’re right that airline can be profitable without flying passengers or cargo, and we’ve banged that drum for years while American lost money on the two but showed modest profit based on its loyalty program. Future prognotications? All those ancillary revenue products are here now, why wait for the future? Delta included them on their report as well.
I’m not sure you read the post.
There is no “deal” to factor in. United isn’t even remotely close to reaching a deal, Scott Kirby has said so himself. How would they know how much a mythical deal is going to cost?
You have fallen for an accounting trick to generate leverage in contract negotiations. Just admit it.
Airlines are big on saying they can’t sustain something but ever since 2001 and again in 2007 pilot wages were absolutely slashed. Prior to 2001 especially adjusted for inflation pilots were paid very highly as compared to 2001-2022. Pilots make significantly less on the first half of their careers as opposed to the last. Training takes as little as 7 years and to start making the bottom bucks it can take an as much as 12-15 depending on how you are getting your hours, hiring requirements, etc. pilots also lose it all for one health problem. They spend on average 96 hours away from home a week.
So yeah they are greedy? Delta, United, American, southwest, Skywest, and others have been reporting huge profits for years and years. Did the pay ever return to pre recession pre 9/11 levels? No. It took bargaining chips. Free market competition. But no one likes that free market competition when it goes against the company.
Now Delta posted a loss. Great, but for the year they have predicted to be making a profit as we enter the busiest fling season. Ironically this is the season where airlines make their biggest profits. More flights, less delays, cancellations, and weather. Also the executive bonuses post first quarter.
Very one sided and biased article without any actual research or sources.
@Jeff – Several sources throughout the post from credible news outlets. I wouldn’t disagree that pilots (and all airline labor groups) got a raw deal during prior periods of instability. Should they get their due now, maybe that answer is yes. Should airlines be making more money from operations than they are, that’s also probably true. The point wasn’t whether a pilot should get X, or is worth Y – it was that if airlines can’t make money in a purely perfect environment as it is today, and they all attribute it to pilot contracts (which are objectively significantly larger than in the past) then what will they do when conditions are no longer optimal.
The title of the article, if we break it down, is: Earnings Reports (financial proof) suggest (their words, and then math) pilot salary (the greatest source of labor cost increases) unsustainable (cannot continue for the long term as they are today.) Feels pretty accurate according to the evidence.
Q1 wasn’t perfect Kyle. It never is. It’s the lowest revenue quarter at any airline. Most airlines make their big profits in Q2 and Q3 thanks to Spring Break and Summer travel. You are basing the year off of the slowest quarter.
Did you know that Delta had a slight loss during Q1 due to the one time charge of paying back pay for the late pilot contract, and also paid down $1.2 billion in debt too? If it was all losses, they wouldn’t have also paid down some debt. Plus, management also added $77 million into the collective employee profit sharing pot for Q1 alone. All of their employees have received raises. Their non union flight attendants got a 27% raise over 3 years during the pandemic and now also get boarding pay too. (Extra pay during passenger boarding).
The dark clouds you forecast don’t seem to take normal Q1 trends into account. That’s unfortunate.
We will see at the end of the year, right?
“Several sources throughout the post from credible news outlets.” Would those be the same news outlets from who you are getting your “34% Delta raise” info? It is incorrect. The increase was 18% in pay and some other low single digit %’s in retirement contribution increases. So in essence you are saying your article is based on some other “journalist” too lazy or incompetent to research the real #’s? I know that the increase in pay misinformation doesn’t negate the point you’re trying to make with this article, but please don’t pretend that you’re using “credible,” reliable or in many cases, even honest news outlets.
It’s very irresponsible and inept to say that a pilot has the same stakes on a life compared to that of a cardiologist. chatGPT can fly a plane or tell one to. Pilots are just glorified bus drivers that can easily be replaced but for psychological purposes.
True, it’s not the same: it’s more. A pilot flies way more people than a cardiologist sees in a year. I also personally see a pilot more times in a year than I see a cardiologist–currently zero times per year.
Until disaster strikes, then you can’t pay them enough to save your life. How much was Sully worth when the birds took out BOTH engines??????? The pilots use their superior skills to make it look easy and boring. One wrong decision made in split second could sink an entire airline. Flying is hours of boredom interrupted by moments of shear terror. It is those terror moments you want the most experienced, best paid pilot in the industry,
Will a captain who is paid $300K be any less safe than one who is paid $200K?
Matt, you obviously have ZERO clue what you’re talking about.!!! You have know idea what it’s like to perform as a professional flight deck crew member traveling over 8 miles a minute with 200 passenger lives in your hands and the consistent attention to detail that requires. Today’s airliners operate a varied degree of tech in an antiquated ATC high threat environment. Throw in distractions such as weather T-storms, snow, de-ice, passenger challenges, and sacrifices to missed family events and operational pressure creep and you have a normal day. For an airliner to get from point A to point B safely it takes the entire crew including the pilots up front. Distracting the pilots with bankruptcy, furlough or other threat adds distraction to the flight deck and creates a safety threat as pilots are human. The industry is littered with incidents and even accidents created by distracted crew. Hate to break it to you but flying is not the same as driving. And saving an airliner such as Ca. Sulley did and Ca. Haynes (Iowa) did takes nerves of steel and discipline the average dude/dudet does not possess! Hence, the pay! PS…. How much is you or your family’s life worth???
We are talking past each other. I have an absolute high level of respect for pilots. From my time in the Air Force to today, these are the sort of men and women that I hold in very high regards – the pilots I know are decent people as well and therefore it is an industry and profession I admire. Indeed, hundreds of souls are put in their hands every time they fly.
I am simply asking, and I’ll ask you the same, how much you think you should be paid? You ask how much is my family’s life worth and I say I’d give up everything I had without question in order to avoid any harm to them. In my line of work (consulting / law), I set the price and if people want to pay, they can and if not, also okay. I understand you world is quite different. But if you could set your pay, what it would be? Obviously, I’d love to make $1K/hour, but my services are not worth that and therefore my hourly rate is much more modest. But beyond “the best union can negotiate” what would your starting offer be if, say, a foreign airline tried to poach you? I’m genuinely curious.
Should a Lyft or Uber driver give less to protect someone’s life because they are not paid 500 grand a year. What about Greyhound and Amtrak?
Yes, they would likely be less safe. Because they’re worried about making ends meet, they will fly more trips and be more fatigued with each passing day. Or they’ll go out and get a second job for more income, leading to the same fatiguing result. More experienced pilots will leave the airlines to fly more lucrative jobs elsewhere or leave the profession entirely.
Really?? Who pays better usually attracts the better candidates. Getting hired at a higher paying airline usually means a tougher interview, tougher hiring requirements, etc. That’s why pilots are scrambling to go to the higher paying Majors with better pay, retirement, and benefits, and that’s why the Regionals are now having to pay a lot more to try to retain pilots, hoping they don’t leave. Wouldn’t you go for the higher pay and total benefits? It’s common sense, actually.
Would you be a better, more thorough blogger if you made $50K instead of $300K.
I don’t blog for the money, but since it is your own life on the line too, isn’t there a self-interested reason to take more precaution whether you make $200K or $300K?
ChatGPT could write an equivalent, or better, article than this one.
You don’t fly a plane by “telling it to”. Dream on…
This article is simply incorrect. Only a tiny handful of pilots will earn those numbers.
Post the high/low brackets for Regional, Domestic and International First Officers and then do the same brackets for Captains.
You will understand then.
Ranges are included in the linked article that put First Officers up to $465,000 after just four years. Regardless of the highest-paid positions, the point remains that airlines – in the best possible conditions – are not profitable this quarter and have all attributed that to pilot pay. The point is that when conditions shift and it’s no longer the best possible conditions, how will airlines hold the line that they cannot hold now?
Isn’t there a way to look at the financial statements and get a sense for what the average pilot at a publicly traded airline makes? (It’s a serious non-rhetorical question, I don’t know the answer)
Folks might find that a more useful number to debate– by stating the high end numbers it makes the numbers more sensational but perhaps less accurate for the typical pilot.
Physician salary data has some notable problems. One, most of it is survey data, and outside of academics the bias is suspected to be that the higher earners under-report. Second there can be a pretty wide distribution– within the same specialty you can find folks making $300k or $2MM. Third, the most financially successful physicians generally have multiple income streams, some of which is not included in salary survey data. For example, a physician might have an ownership stake in the office building in which the practice resides, or the surgery center in which surgeries are performed. While this is physician income, it’s not technically physician salary.
Yeah, nobody is glued to national breaking news when a cardiologist has a bad day at work, now are they?
Go put your head back in the sand and think about how ridiculous your equivalency statement is.
Very few first officers make that much, unless they are senior in their category (plane type) and they bid trips with line check airmen which are subsequently dropped due to new hire training. Then they bid extra trips and get extra pay. But, that’s a very small number at a Major airline. Some pilots pick up open time on their days off, mostly at premium pay. But again, they are flying extra on their days off, which helps the company not cancel flights that are short of crews. A win win situation that actually saves money compared to cancelling flights and paying for stranded passengers.
This article and its sources say “up to” and quote executives. Those are their words, not mine.
First Officers are not making $400,000 after four years at new pay rates. First officers aren’t making $400,000 at any longevity step or position. You can fly a max of 1000 hours a year (Federal Law) and the top pay rate for FO’s under the new agreement is roughly $250 an hour. You do the math.
You’re relaying inaccurate information.
He freely admits that he’s quoting “executives.” Those same executives that hate paying even a penny more than they can get away with during negotiations. I believe Ed Bastion, the current Delta CEO, and former CFO, was quoted in an interview after the bankruptcy in mid-2005:
Interviewer: “What causes you to lose the most sleep at night?”
Ed Bastion: “That I didn’t get more out of the pilot group” in post bankruptcy negotiations.
Really? Quoting those executives? Delta pilots lost all of their pensions and retirement as well as slashed pay, yet it still wasn’t enough for that “executive.”
You think pilots are glorified bus drivers??? The cardiologist only kills 1 at a time. I could potentially kill 300 at once. I deserve 300X what a cardiologist makes.
Let’s get you doxxed and fired, you insane clown.
Fat American pussiboi, are you?
Great post from mommy’s basement, more meatloaf Sara?
This is another artificial swing in demand which will even out as time progresses.
Remember just 12 months ago when you couldn’t find a new or used car on the dealer lot or houses were going for astronomical amounts. Repo cars are flooding the market and repo houses will soon follow.
The ones hurt the most are the young 1st officers with s**t loads of student loans who will be let go by the majors in droves. I’ve handled union contracts and each had a “last hired, first fired” clause. The vast majority of baby boomers have petered out of aviation. It will be up to Gen X to retire to make room for Gen Z.
While I fully understand the premise of the article and think Kyle’s point is well founded. I do question the underlying numbers.
These are assumed costs being reported and are just that assumed based on unknown numbers from agreements that aren’t yet final.
As a former member of an ALPA negotiating committee at a previous airline I have a good degree of insight into how the process works. Airlines as a pretty solid rule will not sign off on pay packages that are unaffordable to them regardless of what others in the industry are getting. It’s one of the reasons you see airlines like Sun Country paying less than airlines like Delta even in the midst of the pilot shortage.
So when an airline posts a loss based on assumed numbers from a not yet signed or finalized pilot compensation package my BS meter comes well off the peg and I start wondering what’s going on that isn’t immediately visible. Numbers like these can be very easily twisted to show a desired result and I’ve seen airlines do these kinds of things more than once. Hence I find it very questionable that losses are being reported on the basis that they are and doubt that these numbers can simply be taken at face value.
You’re article is filled w/inaccuracies of the economics of operating an airline transport category aircraft in the scheduled FAR part 121 environment. Curious how you can make an argument about salaries being unsustainable, but you fail to point out what percentage of operating costs they entail. Did you advocate for higher salaries when the industry routinely paid sub-50k salaries just a few years ago? Arguing about the economics as to why their is a pilot shortage today? Probably not.
Sally – Welcome and thank you for your first comment on the blog. Since you’ve asked about coverage of the deplorable conditions that led to a pilot shortage in the first place, I would point you first to the linked article in the post where we covered such. You can see more than a dozen articles on the same topic decrying the abhorrent pay and as I mentioned in this very piece, onerous investment of pilots, especially those just out of school. Please use the search function to access our more than 11,000 posts and numerous pieces on this very topic. I think you’ll find we agree on what got us into this situation in the first place.
If it becomes necessary that pilots take pay cuts to keep airlines from going bankrupt, then the airline upper management who approved these lucrative contracts should be required to accept even bigger pay cuts.
Agreed. Huge paycuts.
With government bailouts every decade, it does not matter
true but the appetite for bailouts is so low thanks in part due to the unlimited Ukraine funding. I’m sure 0% of that money is being laundered. Impossible.
Truer words were never spoken.
Airlines rarely get bailouts, unlike some Banks these days. The pandemic was the exception, which was remarkable. The Government and tax payers actually gave grants to all of the airlines to keep paying their employees. A miracle really. Of course many corporations got bailouts during the pandemic, and many Covid funds still have unused tax payer money waiting to be used. That hasn’t helped the National debt for sure.
There are far fewer airlines than banks though, and far fewer sizes and categories.
I’m also going to call into question the numbers from the linked article on what pilots will be earning going forward. That article offers final numbers but gives no insight at all into how they are calculated.
Let’s take a Delta A350 Captain at year 12 for example. His pay rate effective Jan 1 2023 is $417.54 per hour. We can, given how the airplane is flown, expect that he will always be getting the $6.50 international pay and $8 Ocean Crossing Pay on top of that. That’s $432.04/hr. If he’s a lineholder 1000 hours of credit per year is a safe assumption which puts his salary if you will at $432,040 per year. Delta contributes 16% of that to his retirement fund which brings him up to $501,166. To this we will be able to add perdiem but that’s not a huge multiple likely another $10000 per year or so. That’s well below the $590,000 quoted above.
A Delta 321 Captain at year 12 flying domestically is looking at $390,792 including his retirement and a 12 year 321 FO would be $266,916 using the same math.
All of these totals are subject to change as there is massive variability in a pilots earnings. A pilot on Reserve gets less credit but one who is a line holder and lives in base can make a LOT more if he’s is always jumping on trips that become available at the last minute often for premium pay. So even among pilots on the same
Pay scale flying the same equipment in the same status years end W2s can vary quite wildly.
I truly don’t know how they budget at all considering all of the variables.
121Pilot – One of my favorite contributors, thanks for weighing in.
To be clear, the $590k is the headline figure that American is using, not Delta – sorry for any confusion. Also, I point out that Delta earned $1.7bn from AMEX for the quarter which is largely profit. It’s Delta, and United that have stated the losses are attributable to pilot increases and I presume they have math to support those claims. My point is solely that if airlines can’t make it now under optimal conditions, how will they make it in suboptimal conditions especially if they are claiming pilot pay is the reason and those contracts last years?
Yes I understood that number was from AA not Delta but top line pay rates at the big three tend to be very close. I used Delta because I had real numbers that could be relied upon so given the scale of the difference I do question the AA number.
Also to be clear I’m not in any way questioning your analysis which is spot on given the numbers reported. My point is that when you’re seeing projected losses based on projected pay rates I do question the validity of those reports. How you project the impact of those numbers and apply them can make a huge difference in the results.
As an example when I was serving on a compensation committee once the company kept complaining that weekend sick calls were out of control and measures simply had to be taken to address the issues. We heard it over and over. So we undertook an analysis of sick calls and found out that believe it or not the peak day for sick calls was Wednesday. The point here is that just because an airline swears some figure is accurate doesn’t always make it so.
@121Pilot – Thanks for clarifying. Your insight is vital.
The most recent Delta earnings report also included a ONE TIME payment of over $700 million due to retro active pay. This payment was made since the Delta pilot group had not received a raise in 4 years. Without that payment Delta had a profitable quarter which is almost unheard of in Q1 in the airline industry.
The United losses are not due to their mainline pilot costs. They are due to wholly owned Regionals that have had to increase wages and sign on bonuses to try to retain their current pilots. Many are leaving to go to the Majors or low cost carriers. This hiring spree is a bit different. Regional Capts are largely leaving for the Majors, while the First Officers are being hired at the Low Cost Carriers, like Frontier and Spirit. The Regionals can’t hire fast enough when they are losing pilots from both seats. And to make it worse for the Low Cost Carriers, many of them offer jobs to those Regional First Officers, and after a year or two they move on to the Majors anyway. That’s why UAL is paying more, to pay to try to keep their Regional pilots in place for fees to their hubs from smaller communities.
Your comment touches on a few things. 1) The airlines are lying about why they missed earnings. 2) All airlines are looking for pilots right now (so demand is up which relates to higher costs.) 3) Maybe inflation is part of the issue.
But to the regional issue, I don’t see how this isn’t still a pilot pay-related concern. If the regionals increased costs to carriers and cut flights because of a lack of pilots and new expenses to pay them more, then that is still a pilot pay concern, just for a third-party but of the same category, right?
Is it unsustainable or unstable? The headline and the opening sentence don’t match. Makes you wonder about the content.
I remember looking at an airplane crash of a couple of years ago and thinking that a root cause was the limited flight hours of the first officer which put way too much decision making pressure on the pilot. I think that the 1500 hours is still a good number. The days of two pilots in the cockpit are numbered. The next step will be one pilot in the cockpit and one remote pilot. Then it could go to two remote pilots or a computer based pilot and a human pilot. Ultimately there will be no pilots onboard in most cases.
Lets hope its not based on the current version of AI or we’re all hopeless souls
How about the mandatory retirement age? Should that be raised or changed to competency and fitness for the position? For example, there could be pilots that may no longer qualify at age 55 but those who are mentally and physically fit and are aged above 65 could remain eligible.
Raising the age does not help the airlines. According to Kirby at United, when they looked at their current 64 year old pilots, 40% of them were on disability. Maybe they decided to get that hip surgery or elbow surgery done before they retired? He said the airlines were against raising the age. I actually think they 1500 hour rule for new hire pilots is a bit much. Maybe lower it to 1000 hours, allowing pilots to fly at the Regionals faster, which could help those smaller communities that are losing service. The Colgan crash was awful and I understand the reaction, but 1500 hours may have been a stretch. What is the difference between 1000 hours and a 1500 hour CFI instructor? A few hundreds more steep turns with new students? It doesn’t really make that much difference.
More sims could also be added too to help with CRM issues. Better safety programs and sims could be used to cover for the 500 fewer hours in a Cessna.
The reason so many pilots call out sick at that point in their careers is because they can’t be compensated for unused sick leave. It’s use it or lose it and they certainly aren’t going to give it back to the company when they retire!
Highly paid executives at the airlines are scapegoating labor again. I guess they need excuses for the shareholders to justify their own worth in light of questionable performance. Next they’ll be blaming flight attendant, mechanics etc.
I love everyone freaking out about the long term effects of this. In the not so long term, computer vision techniques are going to allow for automatic/remote cargo flights (opening up pilots to focus on passenger service) and probably one pilot commercial flights (one in the air one on the ground). As safety is paramount, once these techniques pass the threshold, there will be a lot fewer pilot expenses. This plus the add-on effects of airline pilot training programs (United Aviate eg) probably makes this a shorter term hurdle for management.
A fair point. I’d love to be a fly on the wall when they are discussing pilot automation
Maybe eventually remote cargo flights, but most actual passengers prefer pilots at the wheel. When something goes wrong, they want pilots who actually have a “stake in the game” who will fight for their own lives all the way to the ground, not some Millenial in a game room high on Monster Energy drinks who doesn’t really care about their well-being. Plus, if there ever is an accident with a drone airliner, the lawyers will have a field day, and then it will be over. Cargo on the other hand, doesn’t seem to care as much as passengers. The Cargo pilots will probably be slowly replaced, while human airline passenger pilots will not. And no, single pilot large airliners won’t happen either. What happens when that single pilot needs to go to the bathroom or gets incapacitated? The nerd on the ground will handle it? That’s laughable. Very unlikeky.
The challenge with cargo is that it’s still an aircraft in the sky and a risk to the ground (and the equipment.) If it’s not safe for passenger flights, it’s not safe for cargo flights.
First quarter is one of the weakest quarters for airlines. Yes flights are full, but the airlines aren’t flying as many flights as they will be during the summer travel season. Let’s wait a couple of quarters and see how things shale out before the doom and gloom.
“Delta and United have reported losses on the back of airline pilot salary increases and looking forward, they appear to be unstable.”
Are these articles written by a bot from Radio Shack?
No, written by a human capable of making a mistake. Isn’t it bots that don’t make mistakes?
Let the big 3 US carriers sign these contracts with their pilot unions. Time will tell who was right. I’m betting one (or possibly two) of them will be bankrupt within 5 years and the finger pointing will begin.
Maybe the first one who completed knew the other two would have a harder time equaling it? That’s called a strategy. The weaker ones have to match it to retain pilots or get new ones, but that alone takes money away from paying off debt etc. I’m thinking that is the play here. One has a huge credit card deal and refinery for ancillary revenue, and the others do not.
That could be part of it.
Let’s keep inflation in mind here. With multiple years of greater than 5% and pilots signing multi-year CBAs they won’t really get that much. In 2000, a family friend at DAL was making well over $300k. We are now 20 years past that, factor in a substantial pay cut post 9/11. Just at previously low inflation the top earners should be getting 421,365 a year. Now factor in years to come of dramatically higher inflation I would expect them to ask for more money. I would say anyone is a fool for not trying to get more. I would be willing to guess any PANAM Capt from the 1970s was making well North of $1,000,000 in today’s dollars. Maybe some of these respondents should looks at regional pay today. All the new hire first officers start at $100/hour.
To the writer of this article, you are severely misinformed about the loss United took in the first quarter. That future projected agreement with the pilots includes retro pay, which is back pay compensation in one large lump sum for the time period between last contract expiration and the new contract agreement. Some of the delta pilots were getting $100k retro pay checks, it was huge, but not a reoccurring expense.
Going forward the regular hourly rates for pilots won’t bankrupt the airline even with depressed demand. Worse case scenario the airlines may need to stop hiring or perhaps furlough some if demand slips.
Your quotes $590k salary is incorrect. Top end rate is roughly $420/hr for year 12 wide body captain which equates to $420k annually. That $590 included 401k contributions, per diem, and other health care benefits. Please do your research. Most pilots make on average $200k. A few years ago before the pandemic it was much less. Remember, regionals comprised of half of all flights in the US back in 2019 where average pay was around $80k.
Finally, the “arbitrary” 1500 rule is not arbitrary. Read the rule, airline pilots are required to have an ATP certificate (airline pilot transport certificate). The ATP certificate requires 1500 hrs of total flight time among other requirements. We already made exceptions for former military pilots and those who graduated approved 141 training programs. A commercial pilot certificate that allows one to fly skydivers or give flight lessons won’t cut it anymore.
The market sets wages, not the pilots, nor management. Please delete this misinformed post and save yourself from further embarrassment.
@Joe – I mention furloughs in the closing paragraph of the post which is also not good for pilots. It creates a situation where a pay rise is received today but if unsustainable will put some pilots out of work, whether through furloughs or if the airline ultimately uses bankruptcy as grounds to break the agreements (as American Airlines did with its BK around the US Airways merger.)
You say, “Your quotes $590k salary is incorrect. Top end rate is roughly $420/hr for year 12 wide body captain which equates to $420k annually. That $590 included 401k contributions, per diem, and other health care benefits. Please do your research.” According to American Airlines CEO, Isom, and NBC News it is accurate: “An agreement could include 21% pay increases in the first year of the contract, Isom said. Factoring in higher 401(k) contributions by the end of a four-year deal, a captain flying narrow-body planes would make $475,000 at the top of the scale, up $135,000 from current pay, while the most senior captains of wide-body planes would make $590,000 per year, a $170,000 increase from today.” – https://www.nbcnews.com/business/travel/american-airlines-ceo-may-increase-pilot-pay-590000-year-rcna74133
How is that inaccurate?
As for the objection to arbitrary, you’d have to go back before the rule to understand the requirement’s origins. It was 250 hours prior to the Colgan Air accident at which point congress required 1500 hours depsite both pilots having more than 1500 hours of flight experience. The reaosn why it’s arbitrary is because when the number was selected there was no basis for that number specifically and it wouldn’t have prevented pilots from flying the crash legislators aimed to remedy.
I also say the market sets wages “The invisible hand of the market would suggest that the market rate for a limited (and shrinking) number of available professionals is determining the wage of these pilots. International pilot salaries (especially those in the Middle East) have grown but not to the same level.”
As many inaccuracies as are in your comment it leads me to wonder if you read the piece.
The ATP was always 1500 hours, it only before that you could hire pilots as commercial certificated pilot (Commercial is not an ATP, completely separate certificates), for the right seat and only the right seat ( FO), but when you have confluence of events in blood, you see the results before you, all right seat pilots in the airlines, now are required to have the ATP to grace the seat with their butt cheeks. The number is not arbitrary it was FAA requirement to have at least 1500 hrs with a specific break down within the regulation for experience accrued. CFR 14 Part 61. It’s been that way for at least 40 years. If you were lucky enough to have already been on an airline’s property in 2013 (September?) and you had the minimums for the ATP (there were a few at my airline that didn’t), your training cycle was for the ATP, that year, even if you couldn’t hold CA. Before all this you earned your time at the airlines with the potential of having been hired with 250 hrs, (commercial certificate minimum experience) but that almost never happened, if it did, you are f’in a genius and wasting it at the airlines.
You really didn’t do a very good job researching this. First of all the 30 percent plus raises are after 5 to 8 years of negotiation. Airlines are one of the few jobs that can get away without annual raises do to the Railway Labor Act. Airline employees get a couple of years of raises in a contract then fight to catch up for years after the amendable date. Then the public sees the percentage numbers and thinks the employees are greedy.
As far as a pilot crew to Hong Kong, one or two of these pilots will be on the top pay scale. Depending on the airline and flight time there will be one or two Captains and two First Officers.
I no longer do this job but hope both AA and UA get equal or better than Delta. They deserve it.
The most accurate thing in this article is that the airline industry is cyclical and that some pilots are greedy. The $500k number is entirely click bait. I am at a major carrier as a Capt with over 20 years of experience. My pay is about 60% of that number and that is probably the median. The raises you report that are in excess of 30% is really over 7 years at Delta. None of the pilots at the major carriers have had a raise since 2019. I could argue that it is quite possible that at the end of these contracts that pilots didn’t even keep up with inflation. I am very tired of hearing about greedy pilots. In the end a career is about net earnings. I have been laid off for over 5 years after 911 and took over a 30% pay cut for 2 years during covid. Did the cardiologist have to deal with that? Personally I would be OK with the airlines shrinking by 30% and raising the ticket prices. That would solve the pilot shortage and any issues with paying market driven wages. For everyone complaining about ticket prices go see how much it is to ship a 150lb box same day or overnight and ask why no one dog piles on that cost. It’s amazes me that a person will complain about spending a few hundred dollars to ship themselves but not a box.
Pilots are legal restricted from striking. They *must* work, no matter what the wages are, or quit entirely.
So you think that the airlines, with captive employees, are paying the pilots more because… What? They are going to literally bury the company paying pilots when the pilots have no realistic ability to leave?
This is about recruitment. The airlines spent two decades making the job miserable for anyone but the top pilots, and now they are shocked the pipeline has dried up. Boo hoo. No one forced them to pay regional pilots $14k *per year,* living in crew lounges sleeping on couches.
Also, of you think 1500 hours is “arbitrary” and too high, you clearly have less than 1500 hours. It’s a pretty decent restriction, with logical reductions for enhanced training regimens.
The AA CEO didn’t seem concerned about costs when he doubled his salary. Maybe we stop falling for the crocodile tears?
Did you do even a single hour of research before writing this? Truly embarrassing that you claim any sort of knowledge on this subject. Delta posted a PROFIT if you remove the one-time retro payment to pilots, since they were due for a contract 4 years ago. I can’t honestly believe you aren’t aware of this. You are a corporate bootlicker.
Why not remove all pilot costs, then the business will be even more profitable! Let’s toss out weather events, unexpected chargebacks, bad debt, anything that stops the airline from not being profitable.
Did they make more than they spent?
What? Do you even know what retro payments are? The point is there would be no large retro payment and they would have posted a profit if they didn’t delay paying for this contract for 4 years. Adding 4 years of back payments into one quarters earnings and claiming this proves it’s unsustainable is blatantly dishonest.
The only thing “stopping them from being profitable” was delaying paying their employees. Using ignorant bloggers like you to push the narrative that pilots are overpaid is a nice bonus.
Pilots at all majors airlines today, that are still negotiating contracts with their pilots, are paying salaries LESS than they paid in 2000. How in 23+ years are the Pilot rates now unsustainable? Are you making for in 2023 than you did in 2000?? Delta, one of the most profitable airlines today, just agreed to new increased pay for pilots. Are you saying Delta is in danger of bankruptcy with these new rates? Your logic seems flawed and best and just another airline CEO talking point at worst. I guess you think by spreading the word of corporate CEOs you will remain in their graces. I for one would rather you report facts objectively! Bottomline… airline pilots at most major carrier are underpaid and are paid rates less than they were paid 2+ decades ago.
So let me get this right.; United is forecasting an increase in labor costs and projecting a 9% profit margin. What is unsustainable about this? Profit margins for airlines rarely reach double digits.
Let’s use Alaska as an example, which also lost money in the first quarter because airlines almost always lose money in the first quarter, still projects between 9-12% profit margin full year. Their pilots have a new contract and the airline will be as profitable as it was last year before the new pilot contract was in affect. I’m not sure why the hate for people that have a hugely costly, stressful job that requires significant time away from home. I guess we just aren’t supposed to get pay raises? Thanks.