Gerard Arpey Costs Quotations

First, we have to lower our costs to levels that are more competitive. This will prevent the lower-cost airlines from pushing us out of the markets we want to serve. We've made great progress on this front, but we need to keep pushing.

Our Fly Smart philosophy is about investing only on those points of differentiation that pay for themselves, that earn a revenue premium commensurate with what it costs us to provide that product or service.

Just to cover the increase in fuel costs over the past two years, American would have had to raise fares nearly $75 per round-trip ticket. During this time period, our average fare increased by only $15.

That doesn't mean you have to have the lowest costs in the industry to succeed. But you need to make sure the activities and product attributes that increase your costs above the other guy bring in at least that much more in revenue, and hopefully more.