5. Some years after Delta's case situation, salaries were no longer the highest cost for Delta. Fuel prices increased dramatically after 2001. How can you deal with this new profitability threat from a cost management perspective?If costs cannot come down, how can we improve the profitability of a firm such as Delta?

ANEXO 2 Delta Airlines Selected Quarterly Financial Data, Panel A: 1993-1998 Consolidated Statement of Income OPERATING INCOME (LOSS) Total Operating Expenses 127 122 89 63 83 410 3,137 -211 160 131 104 87 67 -1 458 3,107 ($429) 1993 T3 2,942 129 67 $3,138 1,161 383 311 190 166 105 92 69 146 3,016 $122 1993 T4 2,742 206 69 $3,017 1,145 372 315 187 172 131 98 94 61 509 3,197 $180 1994 T1 2,691 187 65 $2,943 1,145 331 311 182 170 127 102 98 64 482 3,010 ($67) 1994 T2 2,918 247 74 $3,261 1,138 325 381 173 170 -139 133 113 97 67 826 3,583 ($682) 1994 T3 2,933 138 86 $3,157 1,138 362 322 172 164 150 137 116 111 102 73 156 3,003 $154 1994 T4 2,688 154 77 $2,919 1,074 357 298 172 155 165 118 122 112 110 60 158 2,901 $18 1995 T1 2,685 134 83 $2,902 1,102 321 285 171 147 172 92 155 109 110 65 133 2,862 $40 1995 T2 3,013 139 64 $3,216 1040 330 290 156 156 131 96 163 98 114 68 125 2,767 $449 1995 T3 2,977 129 82 $3,188 1,037 348 278 140 161 145 104 172 109 113 69 126 2,802 $386 1995 T4 2,731 135 78 $2,944 1,051 355 246 139 159 150 91 163 102 109 56 154 2,775 $169 1996 T1 2,774 126 64 $2,964 1,077 365 241 138 156 159 87 187 88 82 59 556 156 3,351 ($387) 1996 T2 3,134 131 94 $3,359 1,041 396 277 138 158 140 86 182 77 75 64 273 157 3,064 $295 1996 T3 3,170 124 138 $3,432 1,092 416 278 137 166 179 105 199 108 99 64 151 2,994 $438 1996 T4 2,925 145 127 $3,197 1,107 466 237 137 174 149 94 182 103 92 62 167 2,970 $227 1997 T1 3,160 142 118 $3,420 1,118 444 250 136 180 172 92 179 106 99 63 183 3,074 $346 1997 T2 3,250 143 148 $3,541 1,127 397 251 137 190 177 98 191 117 96 67 174 3,022 $519 1997 T3 3,260 143 150 $3,553 1,204 409 266 137 198 164 111 172 124 169 168 3,122 $431 1997 T4 3,133 160 141 $3,434 1,206 409 235 137 211 170 105 169 126 153 181 3,102 $332 1998 T1 3,118 138 133 $3,389 1,179 342 229 137 218 172 107 212 126 99 58 174 3,053 $336 1998 T2 3,669 141 -129 3,681 1,261 347 250 141 233 94 127 141 119 -99 269 203 3,086 $595 1998 T3 3,487 139 176 $3,802 1,237 339 252 145 218 196 133 183 143 179 225 3,250 $552 1998 T4 3,135 150 163 $3,448 1,217 351 208 146 233 179 124 193 138 164 175 3,128 $320 139 140 114 -114 112 414 52 Stabilization Act 195 186 Asset Writedown 184 326 Landing fees 298 383 Facilities and other rent 366 1,205 Contracted Services 1,200 $3,132 Passenger Services $2,927 57 Selling Expenses 49 177 Aircraft Rent 168 2,897 Other, Net 2,709 1993 T2 Cargo 1993 T1 Passenger Other Restructuting fees Aircraft Maintenance and Repairs Depreciation and Amortizaction Passenger Commissions Aircraft Fuel Salaries and Related Costs Operating Expenses Total Operating Revenues Operating Revenues 1999 T1 3,203 134 167 3,504 1,268 316 191 146 241 192 113 190 134 176 181 3,148 356 1999 T2 3,860 134 -151 3,843 1,271 354 216 153 269 74 130 206 146 188 194 3,201 6,642 1999 T3 3,593 140 96 $3,829 1,306 367 203 154 263 160 133 213 166 180 149 199 3,493 $336 1999 T4 3,293 153 261 $3,707 1,349 384 174 169 284 200 122 215 148 179 320 179 3,723 ($16) 2000 T1 3,589 141 230 $3,960 1,428 434 169 185 297 198 102 228 171 188 205 3,605 $355 2000 T2 4,401 145 -154 $4,392 1,514 461 176 186 302 86 114 237 196 195 86 226 3,779 $613 2000 T3 4,050 141 154 $4,345 1,514 533 164 183 281 190 134 239 184 199 22 192 3,835 $510 2000 T4 3,617 156 271 $4,044 1,515 541 152 187 307 214 120 262 172 189 226 3,885 $159 2001 T1 3,598 140 104 $3,842 1,607 514 141 188 324 179 114 257 187 198 248 3,957 ($115) 2001 T2 3,537 131 108 $3,776 1560 463 144 186 331 165 127 253 193 192 60 216 3,890 ($114) 2001 T3 3,190 116 92 $3,398 1,534 472 137 183 318 152 124 248 216 198 68 -171 170 3,649 ($251) 2001 T4 2,639 119 105 $2,863 1,423 368 118 180 310 120 101 258 205 192 991 -463 182 3,985 -1,122 2002 T1 2,878 111 114 $3,103 1,501 339 107 178 281 145 94 263 185 203 202 3,538 ($435) 2002 T2 3,217 109 148 $3,474 1,563 401 89 179 291 140 98 241 181 211 23 184 3,601 ($127) 2002 T3 3,165 112 143 $3,420 1,555 468 72 175 289 141 95 256 182 213 225 168 3,805 ($385) 2002 T4 3,061 126 121 $3,308 1,546 475 54 177 287 113 85 243 163 207 169 3,670 ($362) -40 191 -34 Operating cost per Available ton mile Operating cost per Available Sit mile Operating Revenue per Available Sit mile Revenue Ton Miles Revenue Passenger Ton Miles Revenue Passenger Miles Renevue passegers emplaned Revenue Miles Scheduled Revenue Miles Flown Revenue Air Hours (thousands) Number of departures (thousands) Available ton miles Available sit miles EXHIBIT 4 Selected Quarterly Statistical Data 1993 T1 24.6 3,196 230.9 341.5 144 147 17.9 14 1,402 1,580 $118.97 $127.54 $0.98 1993 T2 25.1 3,263 236.5 344.8 148 148 19.8 15.5 1,547 1,728 $124.55 $123.55 $0.95 1993 T3 25.5 3,318 236.6 345.1 149 150 20.6 16.5 1,645 1,822 $123.00 $118.22 $0.91 1993 T4 24.6 3,228 229.9 339.7 145 146 20.1 15.5 1,550 1,747 $122.67 $129.99 $0.99 1994 T1 23.8 3,132 223.6 333.2 142 145 19 14.7 1,468 1,647 $123.43 $126.25 $0.96 1994 T2 24.5 3,226 228.7 338.1 145 146 20.9 16.1 1,607 1,788 $133.02 $146.14 $1.11 1994 T3 24.9 3,283 230.5 340.1 147 148 21.5 16.9 1,686 1,856 $126.60 $120.43 $0.91 1994 T4 24.8 3,268 230.1 341.7 147 148 20.8 15.8 1,584 1,775 $117.67 $116.95 $0.89 1995 T1 24.5 3,217 226.5 339.4 145 147 19.5 15.1 1,505 1,677 $118.32 $116.69 $0.89 1995 T2 25 3,251 226 340.7 147 148 20.4 15.9 1,592 1,759 $128.45 $110.52 $0.85 1995 T3 25.2 3,276 225.8 339 148 149 20.3 16.3 1,631 1,793 $126.26 $110.97 $0.86 1995 T4 25.1 3260 223 341.2 147 148 20.4 15.9 1,594 1,772 $117.17 $110.44 $0.85 1996 T1 25.3 3,291 218.6 345.9 147 152 21.2 16.8 1,678 1,839 $117.03 $132.31 $1.02 1996 T2 26.3 3,418 224.9 352.4 153 154 23.3 18.6 1,856 2,029 $127.89 $116.65 $0.90 1996 T3 26.8 3,486 226.8 357 156 157 23.6 19.3 1,930 2,101 $128.06 $111.72 $0.86 1996 T4 27 3510 229.4 365.7 157 159 23.2 18.3 1,827 2,026 $118.25 $109.85 $0.85 1997 T1 27 3,509 228.3 369.2 157 159 23.2 18.5 1,852 2,036 $126.57 $113.76 $0.88 1997 T2 27.5 3,573 232.2 372.9 160 161 25.1 20 2,003 2,191 $128.93 $110.03 $0.85 1997 T3 28 3,652 234.8 375.2 163 165 24.8 20.3 2,033 2,223 $126.88 $111.49 $0.85 1997 T4 27.8 3,623 233.2 378.4 162 164 24.1 18.9 1,890 2,094 $123.69 $111.73 $0.86 1998 T1 27.1 3,537 227.8 372.3 158 161 23.3 18.4 1,844 2,030 $125.19 $112.78 $0.86 1998 T2 27.3 3,568 230.5 373.2 160 162 25.8 20.6 2,056 2,241 $134.84 $113.05 $0.86 1998 T3 27.8 3,627 229.5 376 163 167 24.2 19.8 1,975 2,156 $136.94 $117.06 $0.90 1998 T4 27.9 3650 229.4 380.8 164 166 24 19.1 1,914 2,106 $123.39 $111.94 $0.86 1999 T1 27.4 3,587 224.7 377.7 161 166 23.7 19.2 1,917 2,096 $127.90 $114.91 $0.88 1999 T2 28.1 3,698 228.9 383.5 165 168 25.7 20.8 2,083 2,258 $136.71 $113.87 $0.87 1999 T3 28.5 3,773 228.5 381.4 167 170 25.2 20.9 2,093 2,267 $134.28 $122.49 $0.93 1999 T4 28.5 3,846 229 387.4 167 170 24.1 19.4 1,938 2,139 $130.16 $130.72 $0.97 2000 T1 28.1 3,902 224.5 384.8 165 171 23.6 19.1 1,914 2,099 $140.78 $128.16 $0.92 2000 T2 28.5 3,952 225.8 386.4 167 171 26.4 21.8 2,179 2,369 $154.22 $132.69 $0.96 2000 T3 28.8 4,029 225.6 387.3 170 173 25.2 21.7 2,166 2,344 $150.70 $133.01 $0.95 2000 T4 28.1 3,922 223.6 387.5 166 175 23.2 19.2 1,922 2,116 $144.05 $138.39 $0.99 2001 T1 27.3 3,841 219.6 381.7 162 169 22 18.2 1,821 1,988 $140.53 $144.74 $1.03 2001 T2 28 3,936 225.5 387.8 167 172 24.4 20.1 2,012 2,177 $134.68 $138.74 $0.99 2001 T3 27.1 3,819 214.7 373.2 163 174 21.9 19 1,899 2,044 $125.28 $134.53 $0.96 2001 T4 24.7 3,507 196.1 338.3 147 148 18.9 15.9 1,588 1,709 $116.13 $161.64 $1.14 2002 T1 24.5 3,501 196.9 341.6 146 148 19.8 16.7 1,674 1,808 $126.65 $144.40 $1.01 2002 T2 25.3 3,622 202.5 348.1 150 152 21.6 18.3 1,829 1,975 $137.32 $142.34 $0.99 2002 T3 25.6 3,674 202.5 346.8 152 153 21.7 18.8 1,877 2,008 $133.62 $148.66 $1.04 2002 T4 24.5 3,524 177 332.2 140 141 21 17.6 1,760 1,906 $135.19 $149.98 $1.04 Passeger Load Factor (%) Passenger Mile Yield $193.23 56.99 $187.28 61.51 $178.83 64.48 $176.96 63.01 $183.28 61.58 $182.99 65.55 $173.98 67.6 $169.73 63.84 $178.86 61.38 $189.27 63.58 $182.49 64.61 $171.33 63.44 $165.35 66.24 $168.85 70.66 $164.22 72.03 $160.11 67.57 $170.65 68.53 $162.27 72.92 $160.37 72.59 $165.74 68.09 $169.10 68.11 $178.47 75.31 $176.52 71.15 $163.76 68.51 $167.10 69.97 $185.30 74.11 $171.68 73.39 $169.91 68.05 $187.50 68.05 $201.97 76.51 $186.98 75.13 $188.15 68.48 $197.58 66.61 $175.78 71.77 $167.99 70.01 $166.17 64.42 $171.92 68.33 $175.87 72.31 $168.58 73.35 $173.96 71.91 ANEXO 5 JetBlue Airways Corp. Selected Quarterly Data, 2001-2002 a Consolidated Statement of Income (in millions) Operating Income (Loss) Total Operating expenses Other operating Expenses Landing fees and other rents Maintenance Materials and Repairs Sales and Marketing Aircraft Rent Aircaft Fuel Salaries, Wages and Benefits Depreciation and Amortization Gastos de operacin Total Operating Revenues Passenger Revenues Other operating revenues Ingresos de operacin 2001 T1 62 2 $64 16 9 6 2 6 1 6 12 $56 $8 2001 T2 76 2 $78 19 11 8 2 6 1 6 14 $67 $11 2001 T3 80 2 $83 22 12 9 3 7 2 8 16 $78 $4 2001 T4 92 3 $96 28 11 10 3 9 2 8 21 $92 $4 2002 T1 129 4 $133 34 13 9 5 10 2 10 28 $110 $23 2002 T2 144 5 $149 38 17 10 6 12 2 10 28 $122 $28 2002 T3 160 5 $165 42 21 10 7 12 3 12 37 $143 $22 2002 T4 182 6 $187 49 25 11 10 11 3 12 35 $156 $31 EXHIBIT 6 JetBlue Airways Corp. Selected Quarterly Statisticas Data Passenger load factor(%) Passenger mile yield Operating cost per available ton mile Operating cost per available seat mile Operating revenue poer available sit mile Revenue ton miles Revenue passenger ton miles Revenue Passenger Miles Revenue passengers emplaned Revenue miles scheduled Revenue miles flown Revenue air hours Number of Departures Available Ton Miles Available Sit miles Other Statistical Data (in thousands) 2001 T1 746.1 74,806 5.3 10.5 4,597 4,606 627.6 599.4 59,938 60,246 $85.58 $75,47 $0.75 $103.38 80.33 2001 T2 960.4 97,476 6.3 13.2 5,923 5,929 741.7 764.6 76460 76,859 $81.63 $70,14 $0.69 $99.60 79.61 2001 T3 1178.4 118,098 6.9 15.6 6,976 7,275 782.8 863.1 86,315 86,752 $70.10 $66,53 $0.66 $93.00 73.25 2001 T4 1374.9 138,194 7.8 18.6 8,452 8,487 904.3 1,050.2 105,022 105,742 $69.50 $66,58 $0.66 $87.70 76.39 2002 T1 1613.5 162,227 9.4 22.3 9,956 9,960 1169.7 1,302.7 130270 131,148 $82.66 $68,17 $0.68 $99.10 80.74 2002 T2 1930.6 386,215 10.1 26.2 11,921 11,921 1323.1 1,624.1 162,415 163510 $77.34 $62,98 $0.31 $88.84 84.13 2002 T3 2225.8 81,313 11.2 29.5 13,739 13,739 1452.6 1,886.8 188,678 189,644 $74.25 $64,16 $1.76 $84.93 84.77 2002 T4 2469.8 390,278 13.4 33.5 15,210 15,246 1726.6 2,016.2 201,623 202610 $75.82 $63,09 $0.40 $90.04 81.64 Delta's New Song: A Case on Cost Estimation in the Airline Industry Dikolli, Shane S;Sedatole, Karen L Issues in Accounting Education; Aug 2004; 19, 3; Business Premium Collection pg. 345 Reproduced with permission of the copyright owner. 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