Blog Archives

… Spirit Airlines

SpiritI just flew Spirit Airlines roundtrip from Managua to Ft. Lauderdale. I’ll spare you all my personal review of the airline, but the general public’s opinion is undeniable. They like the prices and hate the service. On the occasion of my return, it was late at night, there was a massive storm barreling across the country, and a Delta flight had earlier in the day skidded off the runway at La Guardia, shuttering the airport for hours. A lot of people were in air travel purgatory that night, and I overheard on more than one occasion “I am never taking Spirit again.”

Airlines, like most companies that offer services, not goods, have high fixed cost. They have to pay their staff and buy and fuel airplanes, whether they are full or not. And any time an airplane is not flying, it is unused capital. Spirit has done an excellent job managing this challenge. By positioning themselves in a South Florida hub, Ft. Lauderdale, they can easily access Central America, the Caribbean, and parts of Central America. Many airlines leave their regional planes at the gate overnight. But Spirit gets them to Ft. Lauderdale, and then sends them on return red-eyes to the Caribbean, Central America, and Colombia. By 6:00 AM planes-full of passengers arrive in Ft. Lauderdale, and either stay in South Florida, or continue on other Spirit flights to their final destinations, whether they be Chicago, New York, Dallas, or elsewhere. Spirit simultaneously tapped what was an under-served market and increased the utilization of their 65 airplanes strong fleet (as of the end of 2014).

Spirit Airlines Route Map

Spirit Airlines Route Map

The downside of this is that they have no buffer in their schedule. On the occasion on my flight from Managua, we were nearly an hour delayed. The plane had been getting more and more late throughout the day, having already made a few trips between Ft. Lauderdale and La Guardia before heading to Nicaragua. Then, as soon as we got to Ft. Lauderdale (late) the plane was scheduled to immediately head out to another domestic destination. It certainly departed late, starting off its next day of work on a bad note, and probably continuing late for the foreseeable future. This gives the airline absolutely no buffer in its schedule. Many airlines leave their regional jets idle overnight. So if an airplane scheduled to arrive at its final destination of the day at 10:00 PM doesn’t get there until 11:30 PM, that’s not a problem for its next departure, at 6:00 AM. However, Spirit does not have this luxury with its fleet.

The result: the worst on-time performance among American airlines. 67% of flights land on-time (within 15 minutes of their scheduled arrival time) in 2013. That’s dead last in the United States, Mexico, and Canada, according to Bloomberg.

Many people complain about how Spirit “nickles and dimes” its passengers. But truly, travelers who are honest about their baggage and pay ahead of time will find themselves paying less for flights than on other major carriers. The true cost comes in late arrivals. For someone with a tight itinerary, Spirit may not be the right choice.

Sources:

http://www.bloomberg.com/news/articles/2014-02-11/spirit-airlines-passengers-go-for-cheap-tickets-over-time

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… Oil

Having now written four articles on oil, its price, and the consequences that has for everyday uses of oil, such as gasoline and airfare, I have decided to turn these into a series of posts I am calling the Economics of Oil.

Fill Up at the PumpPart 1:

The Economics of Gas Prices

 

 

Oil PumpPart 2:

The Economics of International Oil Price Conspiracies

 

 

airplanePart 3:

The Economics of Airfare

 

 

Bitcoin MiningPart 4: 

The Economics of Bitcoing Mining*

 

 

As always, comments are welcome and encouraged, even if you disagree with me on any point.

*And yes, you will see just how much similarity Bitcoin mining has to oil

… Ebola Screening

Sorry that I have not posted in a while. I have been a bit busy and I recently came down with the flu. It is only fitting that this article is about disease. I’ve also got a climate change post in the works. I wanted to post it a few weeks ago when all eyes were on New York, so I guess I’ll just have to post it with a back-date now.

Two aspects of the Ebola case in Dallas bother me a lot. The first is that the patient went to the hospital with symptoms, told the hospital he had recently been in West Africa, and nevertheless he was turned away. I can’t know for sure, but I assume that the patient is uninsured, and the admitting nurse, who is instructed to turn away patients who are unlikely to be able to pay their hospital bills, simply saw the hospital’s finances as a greater danger than Ebola.

o-EBOLA-570

Because of this episode, the White House is considering establishing States-side Ebola screening in airports. However, people seem to be at a miss on how to implement this. They say that there are just too many airports and too few West African passengers. That’s the second aspect that bothers me a lot. It is fairly easy to identify which airports have the highest rate of passengers coming from Liberia, Guinea, and Sierra Leone. Here’s how:

I assume that the FAA has a database of all passengers coming and going from the US. If not Homeland Security, the airlines, or probably the NSA does. Gather this data and discard all trips that do not originate in West Africa. Then count up all the trips by the airport that they terminate in and convert this into a percentage. And there you have a crude estimate of the most likely entry points for Ebola into the United States of America. I’m assuming that JFK will be high on the list. Maybe Chicago, LA or San Francisco, and maybe Dallas and Miami will be high on the list as well.

Now that will only cover some of the possible passengers who could carry the virus. People could travel to an infected country on a different ticket, and then later come back to the United States. For instance, last year my friend went to West Africa for work, and on the way home he spent a few days in London. I assume that his Africa-London ticket and his London-US tickets were different.  These would be harder to track because I don’t know if there is reliable data available on these trips. Maybe Homeland Security, the NSA, the FBI, or the CIA tracks these trips, but I think it would be difficult for even an economist at the CDC with security clearance to obtain this information. However, on landing cards for the US you are asked, “Countries Visited on this trip prior to US arrival.” Of course these are not digital, but it is possible that Homeland Security has some stats they can share. I won’t dive into how to process these stats, since we have no idea what form they could take.

Landing Card

Lastly, another way to capture the elusive passengers who visited West Africa on non-US terminal tickets is through a random sampling method. First, collect a list of all possible one-stop destinations from Liberia, Guinea, and Sierra Leone. I think that one stop is reasonable. There are very few non-stop flights from West Africa in general, but I think that two-stop flights may be casting the net a bit too wide. From this list, eliminate any flights that terminate in the US (those are already covered by the supposed-FAA data) and any flights that do not terminate in an airport with flights direct to the United States. From the FAA data, randomly select passengers departing from these airports to see what airports they are arriving to in the US. The random sampling could even be weighted, giving higher preference to more likely airports, such as those in Europe, and lower preference to less convenient flights, such as East Asia. Simply add this sampled data to the FAA-obtained data and you have a more complete, albeit less-than-perfect, picture.

The last obstacle is time-frame. Peoples’ flight patterns and behaviors have changed since many airlines have cancelled flights to West Africa. So this data should probably only be collected over a six month period or so. Otherwise we would be setting up screening centers in airports that are no longer seeing passengers coming from West Africa.

If these data are properly parsed and analyzed, the government would have a list of the most likely ports of entry for Ebola. With this information they could set up screening centers in a cost effective manner that interrupts and inconveniences air travel as little as possible.

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