In this month’s American Way magazine, American Airlines chairman and CEO Gerard J. Arpey quotes Leonardo da Vinci thus: “Once you have tasted flight, you will forever walk the earth with your eyes turned skywards, for there you have been and there you will long to return.”

Yes, except when fuel prices are pushing the industry to the brink—“a very perilous period” said Arpey following last week’s shareholders meeting. If only American had hedged fuel like Southwest Airlines—since 1999, smartly locking in below-market costs (at price equivalents as low as $51 a barrel for crude) for much of its fuel through 2010.

"The U.S. airline industry as it is constituted today was not built for $125- or $130-per-barrel oil," added Arpey, in the wake of announced layoffs, capacity reductions and instantly unpopular extra baggage costs.

Dell, Inc., similarly focused on cutting costs and boosting revenues, is also delayed at the gate, with selling, general and administrative expenses up 50 percent over two years ago against revenue growth of only 10 percent.

And remember Dell’s deal with WPP Group for a Dell-only ad agency called the DaVinci Group? The agency’s name got changed to "Synarchy," and while perhaps not ranking with famous gaffes such as Fiat’s Uno (“garbage” in Finland) or “sans preservatives” on English cookies sold in France (“without condoms”), advertising bloggers are railing against “Synarchy’s” subversive connection to facism in Nazi Germany, right-wing extremism in Mexico, and secret societies in general.

“The Tom Hanks Project” or “White Albino” would have been worse still, but it sounds like a branding reboot is in order.

Jeff Heilman

5/30/08