Interview Bill McGee

Bill McGee

"It's cost; there's no question," says McGee, a journalist and consumer advocate, on the topic of why airlines outsource maintenance. McGee serves on the Department of Transportation's Future of Aviation Advisory Committee and is an FAA-licensed aircraft dispatcher. This is the edited transcript of an interview conducted on Nov. 16, 2010.

How did you get a background in the airline business? ...

I worked in the airline industry for seven years before I became a journalist and a consumer advocate. A couple years ago, Consumer Reports gave me a very simple mandate. They called me in and said, "Can you give us an update on the state of airline safety?"

“At what level are fares not sustaining the system? It's one thing to cut back on baggage handling and on in-flight snacks, but it's another when we start talking about maintenance.”

I had no agenda, no real biases, and I basically said, "Give me some time to go out and talk to some experts." And rather than talk to talking heads in Washington, I spoke to frontline people: to pilots, to mechanics, to FAA [Federal Aviation Administration] inspectors.

When I asked them, "What concerns you most about safety?," overwhelmingly the answer was maintenance outsourcing. From there, that launched what became a nine-month investigation.

Up until that point, here you are, somebody who's a dispatcher for an airline. How much did you know about what was going on in the industry?

That was probably the most shocking thing that came out of the investigation was my own acknowledgement [about] how little I realized how things had changed.

When I worked in the industry in the 1980s and early 1990s, outsourcing was something that was done primarily by smaller carriers that didn't have the resources to do their own maintenance, but the major U.S. carriers always did most of their maintenance in-house.

There's always been outsourcing to an extent, but there's just been this explosion in the last decade, after about 2002 or so. Suddenly major carriers were, in my view, abdicating one of their most primary responsibilities.

And the reason they do it is simple.

It's cost; there's no question.

You could make an argument -- and they do make an argument -- that in many respects it's better to outsource. Who better to fix an engine than Pratt [&] Whitney, right, or General Electric? ... Is it accurate to say that by doing it in-house it's always better?

No, I don't think you can make generalizations like that.

First of all, there's always been outsourcing with respected aircraft suppliers and engine makers, components, things like that. There's always been outsourcing to Boeing and to Airbus and to Pratt [&] Whitney. That's something that the industry has always seen.

But that's a different kind of outsourcing, isn't it?

Absolutely. What we're talking about now is, the heavy maintenance that airlines traditionally did themselves is now being done at facilities usually outside the United States, but very often inside the United States.

... Quite frankly, some of the problems we uncovered are just as serious at facilities within the United States.

Give us the 36,000-foot view of where things stand right now. How much breadth and depth of change has occurred? What percentage of the work now is done by these facilities, not by the airlines themselves?

One of the ways that we measure safety in the airline industry now is by analyzing risk, and thankfully things have gotten much safer statistically. There are fewer fatal accidents.

Traditionally, in the old days, you used fatal accidents to learn and to improve. Now you need to calculate risk, and you need to be ahead of it and get in front of it. So in analyzing risk, you look at changes to current systems.

In the view of many experts, one of the biggest changes that's occurred in the airline industry in recent years is that work that traditionally was done in-house is being outsourced now. In terms of percentages, for some airlines we're talking about 30 percent of their heavy maintenance. Now [it's] 70, 80 percent or even higher at some carriers. So that is a dramatic change in a short number of years.

So it used to be 30 percent that was done outside the company, and that has been flipped around?

Absolutely.

Seventy percent of their work goes out the door?

Right, some carriers more than others. And some carriers, in fact, have made a decision not to outsource. American Airlines is a notable exception there among U.S. carriers.

Our concern, to be quite honest, it's not so much the work itself; it's the oversight. We are concerned about whether or not the Federal Aviation Administration has the resources, has the inspectors, has the tools to oversee this work. ...

Our concern is that when you have such a dramatic change, when you have work that was concentrated in a finite number of facilities suddenly being spread out to dozens and hundreds of facilities in the United States and all over the world -- Latin America, Asia, Europe -- does the FAA have the resources to oversee this in the same way? ...

When you look at the numbers -- 4,000-plus facilities against a few hundred inspectors -- it's evident that they cannot possibly get around to all these facilities as one would expect. As a passenger, I am assuming the FAA is in there looking over these guys' shoulders, making sure they are doing their job right. That's not really happening, is it?

... The FAA insists that everything is fine. The FAA says that there are enough inspectors that all the work is being overseen properly.

Many experts have told us that's not the case, so that's why we've raised these questions. That's why [the publisher of Consumer Reports] Consumers Union is concerned about this.

In the old days I worked at Pan Am, and Pan Am did all of its heavy maintenance on its aircraft and [had its] head of maintenance facility at [John F.] Kennedy Airport in New York. Just a few miles away right down the road was an FAA facility, and those inspectors had the ability 24/7, any day of the week, anytime they wanted, to simply pop in and look over the shoulders of the mechanics that were doing the work and to see how the work was being done. Now that's been compromised.

So I think a valid question is, if that's been compromised and inspectors don't have the ability to see where the work is being done, how can we be sure it's being done properly?

There's not a lot of popping in anymore, is there?

You really can't pop in to China. I spoke to an FAA inspector who said it took weeks and weeks for his approval to visit a facility in China, and when he finally got there, he said he felt that he was being laughed at, because all the mechanics were lined up, and they were wearing starched white aprons.

If you've ever been inside a maintenance hangar, believe me, that's not how it works. He said it was a case of the proverbial you could eat off the floor, and every tool was polished and put back properly on the rack, and they were all lined up smiling at him. It was clear that they were putting on a show for him.

It's almost mocking him, isn't it, in a sense? It's like, "Catch us if you can."

That's the concern, and I spoke to an awful lot of FAA frontline inspectors who were very frustrated, because these are very dedicated people that want to do their job, and they feel they can't do their job.

If the airline industry has made an economic decision that it's less expensive for the industry to have the work done at outside facilities or outside the United States, that's an economic decision that Consumers Union is not questioning at this point.

But what we are questioning is the oversight, and there is plenty of evidence that makes it clear that the FAA is not able to provide the same level of oversight.

Tell me a little bit about AMECO. What do we know about that company?

One of the concerns we have is just how difficult it is to learn about some of these companies. In the case of AMECO, we just learned through a published report that the FAA has a long history of several years now of citing irregularities there, and FAA inspectors who have been allowed in to visit the facility have raised some concerns.

When I spent nine months investigating this for Consumer Reports, I found it very difficult to even see the basics. In other words, where was the work being done? How many facilities are doing this work? How many FAA inspectors are there to oversee it?

You would think these would be pretty easy questions to get answers to. You would think that someone in the accounting department, the airlines would know how many checks they cut each month to their facilities. And yet we are told it's very difficult information to obtain.

The FAA has a list, doesn't it?

The FAA is not very eager to share that list. We ran into a lot of difficulty just trying to determine where the work is being done and where the inspectors are based.

Why wouldn't a list like that be available to the public?

That's an excellent question. This is an administration that has spoken quite a bit about transparency, and so there were many of us that had very high hopes that some of the issues that existed in the previous administration would be addressed and referenced to this issue. Unfortunately, we still don't have all the transparency that we need.

Why does it make sense for United to fly those 747s to Beijing and do all this work there?

From the airline perspective, there is no question that this is all about cost. I think it's the old adage that you get what you pay for.

The fact is the standards for hiring and training mechanics at airlines here in the United States are quite high. They're the highest in the world. ... When you look at issues from a labor perspective in terms of pay and benefits and health and all that, there is no way that the mechanics at these outsourced facilities are being compensated in the same way.

The industry would tell you, though, that this is a self-policing industry, that no airline wants a crash, and they want the work done right, and they wouldn't fly that airplane over to AMECO if the work wasn't being done right.

I have been in this industry now for 25 years, working in it and writing about it and advocating about it. I've heard this time and again, that no CEO wants to see an airplane crash. ...

I think the proper question is, are all airline CEOs doing all they can to prevent an accident from happening?

We have a system in this country that has worked for decades. We have the Federal Aviation Administration that is chartered, and it's tasked with overseeing the airline industry. And for us to say, well, it's going to oversee some airlines or some aircraft or some mechanics where it's convenient, but we don't have the ability to oversee other work, then clearly there are gaps in the system.

I think we really have to ask ourselves, do we want an airline industry that is self-policing? Historically, since the Wright brothers, that is not what we wanted. We wanted an industry that adheres to the highest standards but had government regulators to oversee that work and make sure that they adhere to those standards.

One way of turning that question around is, if the industry is so good at self-policing, why are we paying for an FAA?

I would answer by saying the industry spends an awful lot of time talking about best practices and the best companies. I worry about the worst companies.

I have worked at some of the worst companies in the industry. This is not theory for me; this is not an economic argument. I know for a fact because I've seen it with my own eyes. There are airline executives that cut corners. If the FAA is not there to police, corners will be cut. That's a fact.

This goes on in any industry, whether you are drilling wells in the gulf or you are trading derivatives on Wall Street. At a certain point, human nature will take you to a bad place, won't it? ...

Absolutely. We'd all like to assume that every airline executive is doing all that he or she can to ensure that the system is safe.

I don't mean to imply that most are not, but what we're talking about here is a safety net. We're not just talking about the best practices. In some cases we're talking about the worst practices. So that's why we have an FAA.

The foreign work that is done at much lower labor rates obviously has really changed the industry and is changing everything by the minute. Give us a sense of the implications.

I don't even think we can measure the implications yet. We're years away from realizing the harm that is being done to this industry.

... Aircraft quite simply are made much better than they used to be -- better materials, better technology. ... So when we talk about maintenance, a lot of people think of it just in terms of repairs. But we're also talking about preventive maintenance in many cases, so we may be years away from seeing some of the side effects of some of the work that's currently being done. That's one aspect.

Another aspect is, what we've done here in the United States is we've taken a career path for so many hundreds of thousands of people -- aircraft maintenance -- and we've decimated it. Unfortunately, the best and the brightest are not entering this field anymore, and the long-term effects of that have yet to be seen as well.

When I worked in the industry and I was licensed by the FAA as a dispatcher, I learned from the older people. I learned from the people who had been doing it for 20 or 30 years, and you were told to sit by and shut up and keep your eyes open and keep your ears open and learn.

That's how mechanics learn. That's how pilots learn. And what we've done is, we have offshored to a great extent an entire industry, so it's going to be a long time before we can even measure how great a loss that is.

So there's a potential competitiveness component to all this? This is one of the few industries we lead the world in, aerospace.

We simply will not continue to lead the world in aerospace if we continue to offshore it.

Tell me about ST, Singapore Technologies, and in particular ST Mobile. ...

... When I started this investigation for Consumer Reports a couple years back, one of the things I was looking at was security standards, and the facility in Singapore was a real eye-opener, because shortly after Sept. 11, there were [15] employees at this maintenance facility, SASCO [ST Aerospace] in Singapore, that were arrested. One of them had connections to Al Qaeda. He was overseeing maintenance work for Northwest Airlines and, believe it or not, for the United States Navy.

In and of itself, that episode brings up the fact that there are two sets of standards, both in the United States and outside the United States, and both in-house and by outsourced maintenance. Security is one of the biggest issues here. ...

The prospect for somebody wanting to do harm to airplanes -- that is to say, terrorists working on them -- that actually does exist?

You don't have to go around the world to find problems with security background checks in maintenance facilities. You can go even to the East Coast to TIMCO, a facility that just a few years ago federal agents went in and arrested several mechanics because they were in the country illegally.

The fact is, that's something that there were preventive measures put in place years ago at the airlines to prevent those things.

At ST, ... a healthy percentage of the workers are actually foreign nationals brought in at a low wage. Is that a trend?

That is a trend. That was the trend that we saw at TIMCO as well. In some cases, these are people that would not be able to pass a security background check at the airlines. ... It's a cursory thing where they look at your police record and FBI background check, and then you are given the ID that allows you to work around aircraft, to work on an airfield and work in secure areas. Unfortunately, these maintenance facilities, they are a huge hole in this network.

How is it that they're able to bring in foreign workers when there's unemployment in this country? Are they unable to find Americans to do this job? ...

There is no question that this all has to do with the wage that they're paying. Most of the mechanics at U.S. airlines are unionized, so they are given a decent wage; they're given health benefits. This is a way of circumventing these contracts; it's clear. Rather than lock horns with the unions, [the airlines] have decided that they're just going to circumvent the entire process.

There was a time when outsourcing started in big numbers in the airline industry. Twenty years ago, the common wisdom was certain functions -- aircraft cleaning, catering, those things -- might be outsourced, but other things would never be outsourced.

Then we saw reservations agents trying to help you with domestic itineraries, and very often they are based in Southeast Asia. Then it spread to other areas that, quite frankly, were always sacrosanct.

Maintenance was something that, no matter how badly an airline wanted to cut costs, it's safe to say that maintenance was always sacrosanct, and now, quite frankly, it's not.

What you described there is a slippery slope.

... We know that the system worked when most of this work was being done in-house. We know that for the better part of the 20th century, for 60 or 70 years, the FAA and its predecessor organizations had the tools, had the inspectors, had the facilities to oversee the work that was being done.

Now there are valid questions about whether or not they are still able to oversee that work in the same way.

Do you have the sense [that they] really don't know what is going on?

My sense comes from the people that I speak to on the front lines. They are my experts; I don't claim to be an expert on this.

... I have spoken to dozens of mechanics both at the airlines and at outsourced facilities, and I've spoken to dozens of frontline FAA inspectors. It's the FAA inspectors that really frighten me the most, because they have made it clear that many of them feel that they are just thwarted, that they can't do their job. They don't have the tools and the resources and the budget to go where the work is being done.

What really bothers me as much as anything about doing this story is how much all of this is treated as a big state secret. The hangar doors are closed. Nobody lets us in. It's difficult for even us to even get a list of all these outsourced [facilities] from the FAA. Why is it treated like a secret?

... One of the things that the FAA does make public is the fines that are levied against airlines. You can go online. ... You go into this database and see what airlines have been levied fines.

So I went through, and I looked at all the maintenance files, and the first thing you realize is that there is a tremendous disconnect between where many of the worst problems are and where the fines are. It's clear that there is work that is just simply not being overseen.

... Several years ago, Northwest Airlines -- before it merged with Delta Air Lines; at that time it was the fourth largest carrier in the United States -- its entire maintenance force went on strike. Much of the maintenance force, about four out of five of their mechanics overnight, did not report for work.

Now, a reasonable person would assume that that would shut down the airline. How could they possibly continue to operate a fleet of 300-plus aircraft when four out of five mechanics were not available?

So I delved into the FAA records, and I was absolutely shocked to find out the amount of fines that the FAA levied against Northwest Airlines for maintenance discrepancies during that strike.

You know what that amount was? Zero dollars, zero cents. None -- the FAA publicly stating that Northwest had no maintenance problems even though its entire maintenance staff was on strike. I think a reasonable person would find that hard to believe.

It boggles the mind, actually. Was everything outsourced? Was that why Northwest didn't get fined and the MROs [maintenance, repair and overhaul facilities] were fined?

Northwest brought in some management and some temporary workers, and they hired and filled in the gaps as best they could. There were some flight cancellations, but for the most part the airline continued to operate.

Is the FAA policing or cheerleading?

I think that is one of the most important questions we can ask the FAA. For years the mandate for the FAA was that it had a responsibility, an actual written mandate to promote the industry. ... That is no longer part of the FAA's mandate, but the question is, does it still linger with some of the senior management?

It's a very complex agency; it has a lot to oversee. It has to oversee the nation's air traffic control facilities. It has to oversee licensing of pilots. It has to oversee airports, so many things, aircraft. But the bottom line is, in the end, it is a policing agency.

And in the end, the way the system works is, if there are discrepancies, you are going to be fined. Or, in the worst case scenario, you're going to be grounded, and that is one of the most fundamental functions that the FAA has.

You mentioned American Airlines, the last of the legacy carriers, as we call them, [to] do its maintenance in-house. We have read a lot about American having a lot of problems with their maintenance, so how do we interpret that? Does that mean that maintenance done by the carriers themselves is not necessarily better, or is it simply that the FAA is looking over their shoulder a little more?

... Because American is standing alone among the legacy airlines in the United States by deciding to do much of its heavy maintenance itself, I think a valid question is, is there a paradox here? Is the irony that the FAA might in some ways be coming down a little harder on American because they are easier to police?

I don't know the answer to that question. I want to be very clear about that. But it does seems quite obvious that the FAA can much more easily inspect American's facilities and mechanics and aircrafts than it can the facilities and aircraft of many of American's rivals, because that work is being done in places where there aren't the same number of inspectors.

... I don't think we should assume that [because an] airline decides to do work itself that it's necessarily going to be better. ...

... Historically, the percentage of licensed, certificated Airframe and Powerplant mechanics working for the airlines in their own maintenance facilities was very high, and it's really just the opposite in these outsourced facilities. Why is that happening?

There's a bit of a loophole here, and I think that's the best way to describe it. ... The regulation requires that an FAA-licensed A&P mechanic sign the book and sign that this work was done properly. That regulation still exists. However, it does not require that the work itself be done by licensed mechanics.

... The way it was put to me by FAA inspectors is, you used to have 10 guys with licenses working on an airplane and one guy signing off on them. Now you have 10 guys without licenses working on an airplane and one guy with a license signing off on it. So I think a reasonable question is, is the work being done to the same standard? ...

... It seems to me a bit of a surprise you don't need a license to work on an airplane.

I think most passengers would be shocked to know that the wide-body aircraft that they're flying in very often are repaired and maintained by people who are not licensed, and in worst case scenarios, [by] people who may not even read and write English sufficiently to understand the manuals that are written in English; that may or may not have passed a background check to go through any kind of security screening to be working on an aircraft; and that may or may not have undergone alcohol and drug screening as is required for all maintenance personnel at U.S. airlines.

And may be making $10, $15 an hour or maybe less.

That raises another question. We've really tried to identify this as a consumer issue and not as a labor issue, but you can't ignore the labor implications, and the fact is, do you want to be flying in a wide-body aircraft at 35,000 feet [maintained] by someone who is making less than the person who is working on the transmission on your car?

This is a safe means of transportation. There is nothing as safe as it for getting from point A to point B, yet I hear a lot of concern. What is the concern? Is there, as some in the industry would suggest, an overreaction? ...

This is an extremely safe industry, and I think that can't be stressed enough, but a lot of work went into that safety record. Tens of thousands of people, men and women for years have worked to make the U.S. aviation industry the envy of the world.

Now, if we've come along in the last seven or eight years and radically changed one of the most fundamental functions, which is maintaining and repairing these aircraft -- how we do it and who does it -- I don't think we can simply rest on the laurels and say, "The statistics show that it's still just as safe as ever." ...

Are we raising an alarm that something is going to happen and we can tell you exactly when and where and how? No, but what we are saying is this is an industry that by its own terms calculates safety in risk.

Well, now we have risk: We have a fundamental change in one of the most fundamental functions, so reasonable people can ask, are we providing enough oversight to make sure that this change is being implemented properly? ...

Is the industry borrowing from its safety margin?

I think there's no question, because, you know, it's simply not good enough to say, well, "Let's look at the safety record, and let's look at the statistics as a way of not addressing what could be problems that are fomenting now." We have to stay ahead of these things, particularly when you are talking about something as widespread as this.

This is not anecdotal anymore. This is not, "Oh, one airline is sending a few aircraft to one facility and one place." This is an industry practice now. Just about all of the major U.S. carriers, with one or two exceptions, are sending most of their aircraft to facilities that, quite frankly, would not measure up if those facilities were maintained by the airline itself.

Now, the FAA says that everything is fine. I think there are an awful lot of experts in the industry that I have spoken to that question that. …

The average consumer, when he or she is thinking about airlines, thinks about two things: fares, lowest the better, right?; and on-time performance. Should they be thinking about maintenance?

... There needs to be much more consumer education on this topic. ... The fact of the matter is, there is tremendous consumer anger toward the airline industry right now. But the irony is that, quite frankly, it's for the least of the [reasons], since I think most consumers are angry over $25 baggage fees and $3 sodas and having to pay $50 to speak to a reservations agent on the phone.

The thing that really should concern consumers is that same mind-set, that nickel-and-diming that leads to charging for checking a bag is also affecting maintenance, which therefore is affecting safety. So this is an issue that the entire country needs to be aware of.

ST as a player: How big a player are they, and to what extent are they typical?

According to statistics I've seen, ST is the largest of all of the MROs, the outsourced facilities worldwide.

I think if you showed a consumer a list of the nine or 10 largest, except for the cases where there are airline names embedded, I don't think they'd recognize most of these names. I think there's tremendous consumer confusion over this. Most U.S. passengers would be shocked to learn that in flying a U.S. airline, that that aircraft might just have been serviced in El Salvador or Singapore or China.

The ST business model, lay it out for us: how ST has found a nice market niche and has exploited it very well. What are they going after?

It was one thing when they were a facility that was based in Asia, and U.S. carriers were sending their aircraft over to Singapore, for example, to have the work done there. Now it's been reversed, so when you talk about outsourcing, ST has come to U.S. shores. Now they have facilities in the South and in Texas, and U.S. airlines are going to these facilities. This is a Singapore-based company that has opened maintenance facilities in the United States.

I think an awful lot of Americans would say: "Wait a minute. What was wrong with all of the maintenance facilities that the airlines poured millions of dollars into throughout the country for decades? And what was wrong with all of those licensed, certified, trained mechanics that U.S. airlines hired and continued to invest in for decades?"

What you have now is foreign companies coming to U.S. shores and outsourcing to U.S. airlines and hiring the absolute cheapest labor they can hire.

Whether that labor is in the U.S. or not.

Exactly. And now it also raises security questions. When you talk about airline security, there is so much emphasis on the final stage of the product, on when the aircraft is at the gate and when we're going through the terminal. This is why we have to take off our belts and take off our shoes and be patted down and have people do all kinds of things to you, and that's all well documented.

All of this is in the guise of providing security so that aircraft, we know exactly who's been handling it, whose been touching it, and that nobody gets on that aircraft that hasn't been properly screened.

Of course, the bad joke to all of this is, where was that aircraft before it taxied up to the gate? Was it just at a maintenance facility? Where was that maintenance facility? Inside the United States? Outside the United States? Who was working on that aircraft? Who was providing security? Who provided the background checks for the mechanics that were working on it?

We're putting so much emphasis on the people walking through the terminal, but meanwhile, that aircraft might have been sitting at a facility where for 72 hours at a time there was absolutely no security, and mechanics could have done whatever they wanted to that aircraft. These are the gaping holes in this system that need to be addressed.

So ST's business model has been, first of all, using their offshore position to provide cheaper labor. Now the next step is to bring the offshore, if you will, onshore. Is this going to be a trend? ...

There's no question that other foreign-based MROs are looking at ST and are looking at that model. If others decide to emulate it, and if other foreign-based maintenance facilities decide to come on to U.S. shores, hire mechanics at wages that most mechanics can't live on, I think it would be the ultimate irony, because basically we will have decimated this industry from within.

No longer will we be shipping aircraft to Latin America or Asia to have work done at levels that most airlines would not allow in-house, but we would now be doing it on our own shores.

The reputation of ST in the industry is what? ... Is it considered good, great, efficient, professional?

... With ST, what you are looking at is the largest of all of the worldwide MROs, and that's a business model that requires hiring mechanics at wages that are going to allow them to offer contracts to airlines at much lower rates than the airlines would be able to do that work with their own mechanics. So you can infer from that whether or not you're getting what you pay for.

Would the ST model work if they had to hire licensed mechanics?

... This is the question that's not being put to the airlines. They keep saying it's more economically feasible to do the work at outsourced facilities. Well, dig down into that and say, why is that? Why is it more economically feasible to have work done in El Salvador or China or Singapore? Why not in Texas or Georgia or Minnesota? ...

As a consumer advocate, I spend much of my time advocating to passengers where they can find the lowest fares, but we as a nation have to ask ourselves, at what level are fares not sustaining the system? It's one thing to cut back on baggage handling and on in-flight snacks, but it's another thing when we start talking about maintenance.

Of course, people, when they pay for that low fare, there's an assumption when they hold that ticket in their hands that somewhere beneath it all the FAA has given its seal of approval to that airline.

We live in a country that has a government with regulatory bodies that oversee so many different industries, so if we walk into a grocery store and we see a package of meat, we assume that the FDA [Food and Drug Administration] has approved it. If we board an aircraft at a U.S. airport, we assume that the FAA has given its stamp of approval. Now some valid questions are being asked: Does the FAA have the resources to do its job?

When you hear this argument that it's better if it's done by a licensed mechanic, it's better if it's done in-house, is that really just an argument by unions to maintain union jobs?

... What we said when we went into this investigation was if we determined, based on speaking to the experts, that the work that's being done outside the airlines is just as good or better, then that is what we will publish, and that is what we will tell consumers. The fact is we found out that that's not the case. ...

To get in the midst of the battles that go on between airline executives and labor organizations, there is a long history there, and there's no question that outsourcing in many ways is really about just circumventing all those agreements. But to just simplify this by saying, "Well, it's all about union workers getting paid too much," I think that's a gross distortion of what's happening here. ...

It's a tough business. These airlines have to figure out a way to make a profit. They have to cut costs to stay afloat, to compete globally, right? ...

It is the ultimate global business; there is no question. It is a cutthroat business in many ways. And yes, the airlines have looked at absolutely every possible thing that they can to cut costs.

But again, maintenance traditionally has been sacrosanct. It was one area where the industry collectively said no, that's not something we can cut.

In recent years, we've seen a change, and I don't think that we've yet seen all the manifestations of that change. ...

... Tell us about the future of aviation in the context of this: There you are at the table with all these CEOs and titans of industry, and is this considered an important subject?

This is one of the most hot-button issues in the industry right now. I know that because I raised it several times at the Future of Aviation Advisory Committee, and I raised it not as a labor issue; ... I raised it as a consumer issue.

... What I said was, before we could even start to talk about passenger rights and how [passengers] are treated during delays and canceled flights and things like that, first and foremost is safety. That's the most fundamental of all passenger rights.

So I have raised this issue, and there is no question it is a very sensitive issue, not only for airline executives but also for aircraft manufacturers and, quite frankly, I think also for the DOT [Department of Transportation] itself and for the FAA. ...

As it is, there is no way for a consumer to know when he or she gets on that airplane how it was maintained or where it was maintained?

That's exactly right, and the FAA says it shouldn't matter. It shouldn't matter if it was done by the airline or done by an outside company. It shouldn't matter if it was done on American soil or if it was done halfway around the world.

In theory, that's the way the regulations are written. You're right: It shouldn't matter. Yet it does matter, because if there are loopholes, and if there are double standards, then in fact we have a problem. ...

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Posted January 18, 2011

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