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Has a bad financial situation, or simply being greedy, impacted negatively the safety of an airline or even caused lethal accidents?

Notice that this is not necessarily a question about low-budget airlines like Ryanair and EasyJet, JetBlue, or Spirit. Low ticket price does not imply the company is in a tight financial situation. No frills does not imply cutting costs at the wrong end.

Although regulations are the same for all, there are certain scenarios where this seems to matter. No airline will be allowed to skimp on safety issues, but wouldn't having less resources imply:

  • Hiring cheaper pilots, which fulfill minimal requirements, and not much else.
  • Flying routes that are open, but less safe, like Ukraine until recently.
  • Putting more pressure on pilots to fly against their judgment.
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  • $\begingroup$ @Federico: that's absolutely not the case. This is not about low-cost, it's about airlines with financial woes. Low cost/no frill airlines could be in a good financial shape. $\endgroup$
    – Quora Feans
    Oct 13, 2015 at 13:44
  • $\begingroup$ ah, I missed a "not" in the first remark. anyway this remains a question either too broad (too many airlines, each with its own market strategy) or opinon based. $\endgroup$
    – Federico ♦
    Oct 13, 2015 at 13:48
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    $\begingroup$ It's a valid question, and I think that when budgets are tight at an airline, they will do the same scrimping that people do when the household budget is tight. I can see inspections being contracted with companies that may do a light inspection for less money and overlook items, etc. However, I agree that this is far too broad to be adequately answered at Aviation.SE. $\endgroup$
    – FreeMan
    Oct 13, 2015 at 14:00
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    $\begingroup$ What if the question was rephrased to ask when financial situation has impacted safety in the past? This would allow the references provided for answers to be based on NTSB (or other investigating entity) opinion rather than the opinion of the author. ASRS reports might also make good references if this change were made. $\endgroup$
    – ryan1618
    Oct 13, 2015 at 14:45
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    $\begingroup$ West Caribbean Airways 708 comes to mind. In this case the pilot was working a second job as a bartender. The airline was in major financial crisis at the time. en.wikipedia.org/wiki/West_Caribbean_Airways_Flight_708 I'm sure you can find more cases where finances impacted safety and the report states that very clearly. $\endgroup$
    – ryan1618
    Oct 13, 2015 at 14:59

2 Answers 2

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Pan American World Airways declared bankruptcy in January 1991. In the year previously they were doing everything they could to to avoid that. To help their cash flow, Pan Am sold five of their 747s for cash to Evergreen International Airlines. The deal was that EIA would immediately lease the five back to Pan Am, which they did. Unfortunately, Pan Am soon defaulted on the lease payments and EIA began repossessing the aircraft.

EIA gave Pan Am fair warning on the repossession of the first aircraft, at which time Pan Am swapped out good components for crap components before surrendering the aircraft. Not to be taken again, when EIA repossessed the second aircraft, they did so without warning at the gate when the aircraft arrived in JFK from Europe.

I was the f.o. on the crew that was sent to get the aircraft. We were in the cockpit setting up when one of our maintenance guys came in and said that they had just received orders to boroscope the engines, which they did while we waited in the cockpit.

After an hour or so, one of our JFK managers came into the cockpit and told us that we wouldn't be going anywhere, that the airplane was not flyable as three of the four engines were significantly below required tolerances.

So, if flying a plane load of passengers across the North Atlantic with three out of four engines below required minimum maintenance standards constitutes a negative impact on safety, then, yes, a bad financial situation did indeed, at least once, cause such.

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    $\begingroup$ I would love to sit down with you over a drink to discuss your career! $\endgroup$
    – Ben
    Oct 15, 2015 at 9:18
  • $\begingroup$ Jeez. That makes two of us, @Ben. Get a booth! $\endgroup$
    – Charlie
    Oct 15, 2015 at 11:32
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    $\begingroup$ I'd imagine we could rent a university lecture hall and fill it up with Terry fans from here! $\endgroup$
    – FreeMan
    Oct 15, 2015 at 14:12
  • $\begingroup$ @Ben Some sites run chat sessions with a specific user: A date and time is scheduled and users can ask anything, the chat log is then cleaned and published as a blog post. You can consider something like this :-) $\endgroup$
    – yo'
    Oct 15, 2015 at 19:03
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To discuss some of your points directly,

hiring cheaper pilots, which fulfill minimal requirements, and not much else

Patrick Smith touches on this in his book Cockpit Confidential (in regards to cheaper airlines but the same idea applies) and basically comes to the conclusion that PIC time has little to do with anything and the statistical differences are small. He mainly points to the fact that the deadliest accident in aviation the Tenerife Airport Disaster occurred not only on the ground but the pilot at the controls was the airlines chief 747 type instructor Jacob Veldhuyzen van Zanten and extremely experienced both in type and as a pilot overall.

flying routes that are open, but less safe, like Ukrania until recently

The most unsafe thing in this case seems to be commercial planes either intentionally or accidentally being shot down, you can find a list here.

putting more pressure on pilots to fly anyway

The FAA regulates the hours a pilot must rest for (and an airline cant short cut this) as for departure or not the end call (as far as I know) lies with the pilot. Your takeaway point here is mainly about management putting pressure on employees to do things that may not be safe or may be out of the machines capability. This is not all that dissimilar what some say the cause of the Challenger disaster were.

You may be able to argue that an airline strapped for cash may put their pilots in poorer accommodations which in turn could lead to a lesser nights sleep and degraded performance but I do not know of that causing any accidents. It did take many years for the FAA to change required rest regulations and you can see some of them here, this was considered a big win for pilots.

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