Peter Greenberg: "We asked what cargo was being inspected, and the answer was nothing"

October 16th, 2006

Peek under the wing at airline secrets
USA Today

Did you know that air cargo doesn't go through the extensive security screening that passengers do?

Or that an airline may show no availability on a flight when in fact there are seats? That's just some of what Today show travel editor Peter Greenberg found when he went behind the scenes at American Airlines for a two-hour documentary airing on CNBC Oct. 18 (9 p.m. and midnight ET/6 and 9 p.m. PT).

Greenberg, who worked with 16 camera crews in 12 locations over five days, was given unprecented access to the inner workings of the world's largest airline for Inside American Airlines: A Week in the Life. He shares his findings with USA TODAY's Kitty Bean Yancey.

Q: So what did you learn that surprised you most?

A: How small the (airline) profit margins really are. Almost every flight is full, but it doesn't seem to make a difference. One flight we profiled – a full flight with 95% of people paying for their tickets – the profit margin was only triple digits … under $1,000. We also show the range of what people paid for a ticket. On one flight from Dallas to Hartford (Conn.) in coach, there was a range of $110 to $950 for that segment.

Q: That's a huge difference.

A: It is. And let's say you want to fly the short distance between Austin and Dallas. The airline may charge you as much as $650 or tell you no seats are available when they are.

Q: Why?

A: Because they're holding out for higher-yield traffic that's going farther – through Dallas to Tokyo or somewhere.

Q: You say that American is the only U.S. “legacy” carrier not to have filed for bankruptcy and that, as at all airlines, cost-cutting is a huge issue.

A: A big cost is the cost of fuel. (American Airlines jets) now taxi on one engine instead of two. They figured out how much water (for sinks and toilets) they need per passenger and don't fill the tank as much so planes are lighter. (Flying lighter planes) saves more then $200 million a year. Just taking magazines off planes, over the course of a year, saves $3 million.

Q: We know airlines have been trimming elsewhere. What did you learn about food?

A: Bring your own. … But I think the airlines are trying to turn (buy-on-board meals) into a profit center. At American, the flight crews earn commissions on every one they sell.

Q: You did your reporting at a panicky time — just two weeks after heightened terrorism alerts, controls on liquids and tighter security checks.

A: What's interesting is what isn't inspected. We spent time at American's cargo operation in Miami. They're shipping more than a million pounds of cargo daily, and 200,000 is U.S. mail. We asked what cargo was being inspected, and the answer was nothing. It's not just American; it's the other airlines, too. Pilots at American are less than thrilled and say so. (American spokesman Roger Frizzell says there are some hush-hush cargo checks that CNBC didn't see.)

Q: That's really surprising at a time when we passengers are being screened more than ever.

A: In all fairness, airlines will argue that they have to follow strict policies set up by the government … such as a “known shipper” program that trusts what you say is in the cargo is actually in there. But our sources at the Department of Homeland Security say less than 15% of all cargo is inspected. (A 2005 report from the Government Accountability Office says nearly all air cargo goes uninspected for explosives.)

Q: What else doesn't the public realize about airlines?

A: How fast they have to turn these planes around to make a buck. We pulled the service logs of one plane – a 20-year-old 767. Since then, it has flown more than 30 million miles. … In one week, it crossed the country 20 times.

Q: I'm not sure I want to know that.

A: The key is maintenance. We spent time at American's Tulsa maintenance center, which operates 24 hours a day. There's the “C-check” they do after a certain number of takeoffs and landings. In a five-day period, they rip the plane apart – the seats, wiring, lights, controls. They check everything and put it back together.

Q: You also got access to American's Dallas command center.

A: It's so quiet. Guys on headsets. Total Mission Control. They're tracking the performance of every flight. They're on the phone with NORAD (North American Aerospace Defense Command). There was a Tokyo-New York flight where a passenger was beating his wife and then punched a flight attendant. Now it's standard procedure to just call NORAD and get an escort of fighter jets. You act first and ask questions later.

Q: Any other thoughts?

A: American is an example of how good management is trying to save a troubled airline. People need to realize that this is a volatile business. (Former American CEO) Bob Crandall says he doesn't know of an airline that's earned back its capital investment. There's the old quote from Richard Branson (of Virgin Atlantic Airways): “If you want to be a millionaire, start with a billion dollars and open an airline.” Airlines are just trying to stay in the air.

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