Crandall Calls Today's Airlines "Laggards In Every Category"

Tell us how you really feel, Bob. In a scathing editorial in Monday's New York Times, former AMR Corp. Chairman Robert Crandall expressed what he feels is the real answer to the problems facing the domestic airline industry -- a belief summed up in the op-ed's title, "Charge More, Merge Less, Fly Better."

"Our airlines, once world leaders, are now laggards in every category, including fleet age, service quality and international reputation," Crandall writes. "Fewer and fewer flights are on time. Airport congestion has become a staple of late-night comedy shows. An ever higher percentage of bags are lost or sent to the wrong airports. Last-minute seats are harder and harder to find. Passenger complaints have skyrocketed. Airline service, by any standard, has become unacceptable."

In the wake of last week's news that Delta Air Lines intends to merge with Northwest Airlines, forming what would be the world's largest airline, Crandall states "the case for mergers is unpersuasive" -- noting consolidation does not lower fuel prices, but does serve to anger airline employees and create their own very high costs.

"Although the system could conceivably be operated by a single efficient carrier, consumers clearly benefit from the existence of multiple airlines," Crandall adds. "The absence of competition never fosters better customer service."

Crandall -- a vocal opponent to the 1978 de-regulation of the airline industry -- says some government intervention is needed to improve the current air traffic control system, and lower taxes on airlines. Conversely, he believes airlines will only grow and survive when they face economic realities, and charge higher air fares to compensate for higher costs.

"Every business must charge enough to cover its operating and capital costs," he writes. "Regulatory and oversight changes intended to make our carriers more successful may well force prices up faster than would otherwise be the case. But we will be better off with higher fares and more competitors than with higher fares and fewer competitors."

Crandall -- who today is CEO of air taxi upstart POGO Jet -- also believes the government must move away from the current "consumer friendly" manner in which international aviation agreements are considered -- he says the current mindset allows more opportunity for foreign airlines to encroach on the US market -- and that offshore maintenance of US planes "should be prohibited.

"Maintenance performed in the United States is done under more demanding rules and a far higher level of Federal Aviation Administration oversight than work done abroad," Crandall writes. "Keeping the work here would enhance any safety improvements that result from the Transportation Department’s new plan to overhaul its oversight procedures. Moreover, bringing aircraft maintenance work back to the United States will re-create many thousands of skilled jobs."

Whether you agree or disagree with Crandall's views, the piece -- available at the first FMI link below -- makes for some fascinating reading.

FMI: Read The NYT Op-Ed, www.flypogo.com