The airline industry has suffered through a tough and unforgiving decade. From the economic effects arising from the ' to the current global recession to the swine flu, the downtrodden industry has taken a huge hit in virtually every front: global terrorism on American soil, global economic recessionand a global swine flu pandemic. Even before the 9/11 attacks, the airline industry was experiencing significant losses and reduced ticket sales. After the attacks, airline share prices dropped sharply, which exacerbated the airlines' already bumpy financial situation.
To boost the fledging industry, the federal government provided an aid package of $10 billion in loan guarantees and $ 5 billion in short term assistance[i].
By 2006, the airline industry was just beginning to recover when it was hit again by another devastating volley. This time the global economic tsunami that started in late 2007 swept the airline industry putting a sharp halt to airline ticket sales.
With the worldwide recession hitting people’s pocketbooks, less people had the disposable income to fly leisurely. In addition, with the advance in technology and the speed of telecommunications, many companies began to discern the greater economic value of teleconferencing from their desktops over conducting face-to-face meetings. Moreover, the higher oil prices coupled with falling demand rocked the airline industry. In a sense, we had the makings of the perfect economic storm which severely affected the industry’s bottom line with a revenue downturn larger than that of 9/11[ii].
Surpisingly, despite the large financial market and auto bailouts that the federal government provided over the last year, the airline industry has yet to ask for a huge infusion of cash.
2009, the current year, started out as a tumultuous period for aviation accidents- one with a happy ending with everyone miraculously surviving and one with a tragic ending with total loss of life. Both stories garnered significant media coverage resulting in tremendous interest and concern regarding safety of flight from both Congress and the American people. Thus it is critical to start our assessment and market audit analyzing the most talked-about aviation news stories and discussing the qualitative effect it had on both the airline industry and air safety.
#1 Miracle on the Hudson
The most viewed aviation news story in the US in 2009 is luckily the most good news human interest story in this industry as far back as we can remember. CAPT Sully Sullenberger’s heroic actions and poise during the historic water landing into the frigid Hudson River created the most revered aviation icon since Amelia Earhart tried to fly around the world in 1937 becoming a champion for women’s causes and a hero for all Americans who aspire to change the world.
On Jan 15, 2009, US Airways Flight 1549 was a scheduled flight from New York City to Charlotte, North Carolina. While on climb, the plane struck a flock of Canadian Geese resulting in compressor stalls and a loss of thrust for both engines. When the crew discovered that the plane would not be able to reach any airfield from its location, CAPT Sullenberger turned the plane southbound and glided it over the Hudson River where it landed near the USS Intrepid aircraft carrier museum.
Immediately after the plane had been ditched into the river. All 150 passengers exited the plane via its wings or from an inflated slide deployed from the front from the right side passenger door. After twice walking the length of the cabin to confirm that no one remained inside, CAPT Sully Sullenberger was the last person to exit the aircraft. CAPT Sullenberger and the crew were immediately recognized for their stellar and incredible performance under immense pressure saving the lives of everyone on board. Over the next several months, Sully became a national icon and an American hero for an industry that desperately needed good branding and persona recognition for someone who Americans can trust and admire. Today after writing a book and going on a busy speaking circuit delivering a potent message of professionalism and courage, Sully has returned to what he loves best – taking the stick in the cockpit taking responsibility of everyone’s safety and comfort within his own hands. For many flyers, there may be nothing more reassuring and inspiring than to sit in the plane and hear the voice of CAPT Sully on the PA system.
#2 Colgan Air Tragedy
Less than a month after the “Miracle on the Hudson”, Colgan Air Flight 3407 marked as the Continental Connection experienced the second year-to-date aviation accident in the state of New York. The commuter plane experienced significant ice buildup on the aircraft’s wings and windscreen shortly before the crash. The National Transportation Safety Board (NTSB) investigation showed that the pilot had failed numerous tests during his career suggesting that he may not have been adequately trained to respond to the emergency that led to the aircraft’s fatal descent. Crew fatigue was also a grave concern since both pilots spent the previous day and night at the Newark airport prior to the 9:18 pm departure[i]. (Photo from Jetphoto.net)
Although the investigators focused on training, qualification and pilot fatigue, the media, the American public and Congress honed in on the shocking detail that Colgan Air pilots as well as many other regional aircrew face long commutes, low pay and second jobs. The analogy that resonated well with the public was the revealing comparison between a bus driver and a pilot: “Most people would be shocked to hear that the train or bus operator who ferries passengers to the airport makes a lot more money than the pilot who is responsible for all the lives onboard.” (Although true, this information can be misleading. Pilot pay per hour is higher than bus and train operators. The distinction is that bus and train operators can work overtime, while commercial air transport pilots are limited to 100 hours of lying in a month). This low wage and sometimes lower skill labor situation prevalent within regionals is a tragic byproduct of the weakened economy and the overall impact on the airline industry that is struggling to streamline and pare down. As a result, many airlines have been forced to fly with more empty seats or cut back on the number of flights altogether as they watch customer traffic fall sharply from the sidelines. For many less-traveled routes, the major network airlines have shifted from the larger 100 to 150 body airplanes to the 50 to 70 seat regional jets or turboprops flown by their smaller affiliates. While the five U.S. network airlines posted a $4.4 billion operating loss over the past 12 months, the top 20 regional airlines amassed a $785 million profit.[ii] This is a tremendous and well-received silver lining for the current gloomy economic downturn. However, the regional pilots are still significantly underpaid compared to their counterparts who work the same hours for the big networks. Many of these pilots are forced to work a second job in the evenings in order to make ends meet resulting in a notable impact on crew rest and fatigue. #3 Wayward Pilots Aboard Northwest
While the airline industry has come under scrutiny in the field of customer satisfaction, the sentiment and respect the American people have for pilots have for the most part remained unscathed. That is why the story of how two pilots overflew their Minnesota airport destination by 150 miles is almost unbelievable. Normally a story that did not have a tragic ending would not garner significant news interest during a busy news season. However, because the pilots denied falling asleep on the job and admitted doing personal work on their laptops, this questionable statement increased the sensationalism and shock value of this bizarre story. It is incomprehensible for many Americans even those who don’t know the slightest thing about aircraft handling to see how the pilots could over fly their destination by such a large degree. Since the Federal Aviation Administration (FAA) has revoked the license of both pilots, the Airlines Pilot Association (ALPA) has assumed the critical role in providing legal assistance and representation of the two pilots in any legal or administrative courts. However, due to the tremendous media interest, ALPA should also consider representing the pilots in the court of public opinion since this could have more impactful repercussions in the airline industry and flight safety overall.
#4 Swine and Airline
Another challenge to the airline industry was the spread of the swine flu. In late April 2009, when the first cases of H1N1 were reported in the United States, the World Health Organization declared a "public health emergency of international concern". Combined with the detrimental effects of the recession on ticket sales, the swine flu spelled deep trouble for the airlines.
The airline industry is very vulnerable to the spread of the swine flu and other bacterial-related communicable diseases which can be spread between humans by coughing, sneezing or by touching. The swine flu is most contagious during the first five days of the illness while children can be contagious for up to ten days[iii]. The swine flu could not have happened at a worse time for this industry. Sadly, more than any other sector, the airline industry was hit hardest by the H1N1 pandemic.
With the exception of Mexicana and other Mexico-based airlines, the US airline industry was impacted the most since the World Health Organization severely restricted travel to Mexico. Every U.S. network carrier flies to Mexico. Some airlines like Continental fly an average of 450 flights a week to Mexico.[iv] Swine flu originated in the rural villages of Mexico and spread briskly throughout all parts of the world, through the freedom and free limits of air travel. Many customers who didn’t want to risk getting sick or getting inconvenienced, simply cancelled their flights to and from countries of concern. Meanwhile, the airlines had to waive change fees for passengers flying through Mexico and provided many refunds for those whose plans were turned around. The airlines industry faced a difficult time adsorbing lost revenue something that took many close to their breaking point. Since another outbreak of swine flu or other communicable diseases are distinct possibilities in the near future, the airline industry must be ready to incur and respond to more damages.
#5 Airlines Leveraging Social Media
Consumers have been using social media like My Space since the proliferation of Web 2.0 around the middle of this decade. Many customers found social media an effective tool to vent their annoyances and share their challenges and lessons learned with air travel. Seeing the enormous potential and instantaneous reach of social media, several airlines over the last year have began a massive campaign launching their own brand footprint into this previously-unchartered territory. These new media sites help airlines market their brand while interacting with customers simultaneously and at the same level. industries have an incentive to fill every seat on a flight. Not only does a full plane increase ticket sales, it gives the impression to flyers that their seats are in high demand. When there are last minute empty seats on a plane, some airline companies advertise these as hot deals on their Twitter page--filling otherwise empty seats while building customer loyalty. Every airline company should measure loyalty and brand satisfaction. Using readily-available social networking sites is relatively fast, easy and cost effective. In addition, ALPA should measure what the American people are saying about safety in flight. Because flyers typically have a considerable amount of downtime waiting for planes to take-off, they often have time in their hands to tweet out their frustrations or satisfactions using their cell phones or PDAs.
The popularity of Twitter and other social media sites lends itself to innovative ways of measuring public sentiment across several geographic regions, relatively quickly and at very low costs. By codifying the language of tweets related to airline travel e.g. "Jetblue is a great company,” analysts are able to determine the opinion flyers have with particular airlines. In a study conducted in Oct 2009, it was determined that after reviewing all pertinent factors, Southwest had the hughest percentage of satisfied customers. [v]Incidentally, Northwest had the lowest percentage of positive tweets. In addition to increasing customer loyalty, social media sites are increasing the airlines' responsiveness, which will be especially valuable in times of crises. We will likely never be able to prevent fatal airline crashes. When an airline does experience a tragic crash, they could quickly transition to crisis communication mode by providing the public with the latest search and rescue information on Facebook and Twitter. Friends and family members can also communicate with the airline staff and other stakeholders by posting questions directly to the airline or collaboratively to the entire public via use of the wall. The public may understand and accept the reason for the plane to crash. But the public will be more critical in evaluating how well and how quickly the airline is able to disseminate timely and accurate information to those concerned. If an airline is able to effectively utilize all mediums at their fingertips to reach out to friends and family and the American people, then they are mostly likely able to gain the respect and trust that they deserve.
Imagine if Twitter was invented prior to 9/11. If the passengers of the doomed United Flight 93 could tweet to the rest of the world that they had just been hijacked, that information could be critical and valuable for both rescue, remembrance and litigation.
Looking forward in this rocky economic environment, ALPA and stakeholders need to be fully cognizant of the top news stories past and present. How the public views the airline industry and how the airline industry responds to the latest news events and trends could set the right or wrong path for the future of commercial aviation in the United States. These second-tired effects would undoubtedly have a huge impact on the pilot labor market and thus determine which airline safety issues are negotiated and prioritized both in the air and within the halls of Congress.
[ii] Mutzabaugh, Ben, “Airline Outlook Worsens; Impact of Crisis Larger than 9/11”, Sept 16, 2009 [iii] Polek, Gregory, “NTSB scrutinizes Pilot Actions in Q400 Crash Probe” Aviation International News, May 12, 2009. [iv] Grossman, David, “Regional Airlines Thrive while the Big Boys Cut Back”, USA Today, Nov 3, 2009 [vi] Graves, Robert, “U.S. Carriers Cutting Service to Mexico”, MSNBC, May 1, 2009
[vii] Warren, Christina, “Analysis: Which Airlines do Twitter Users Prefer,” Mashable, the Social Media Guide, Oct 1, 2009 
