What's the latest at Mesa?

[rene]

Someone from Mesa correct me if I am wrong, but they CAN'T claim that labor is the problem because Delta accused Mesa of improper staffing and Mesa has maintained all along in court that that was not the case.

We can and we should expect MAG to file an 1113 motion to reject the ALPA contract. The creditors committee will require it as a condition of the POR and a potential contract exptension with Airways.

The reality is that the company and ALPA will agree to concessions in the 10-15% range. That is $10 - $15 million savings per year for 4-5 years. Translation? At 6 times EBITDA that is $90 million in value and nobody will just leave that on the table

My 2 cents

 

[Metro752]

We can and we should expect MAG to file an 1113 motion to reject the ALPA contract. The creditors committee will require it as a condition of the POR and a potential contract exptension with Airways.

The reality is that the company and ALPA will agree to concessions in the 10-15% range. That is $10 - $15 million savings per year for 4-5 years. Translation? At 6 times EBITDA that is $90 million in value and nobody will just leave that on the table

My 2 cents

If you guys accept a 10-15% pay cut it, well I don't know what.

No more pay cuts, didn't you guys get that message?

How much less can you be paid? Mesa needs to go away if you guys are already talking pay cuts. You're a detriment to all pilots both union and non-union.

 

[OUPilot01]

We can and we should expect MAG to file an 1113 motion to reject the ALPA contract. The creditors committee will require it as a condition of the POR and a potential contract exptension with Airways.

The reality is that the company and ALPA will agree to concessions in the 10-15% range. That is $10 - $15 million savings per year for 4-5 years. Translation? At 6 times EBITDA that is $90 million in value and nobody will just leave that on the table

My 2 cents

Oh lord I hope you guys would never vote in pay cuts

 

[rene]

Oh lord I hope you guys would never vote in pay cuts

The problem will NOT be the pilots "voting: for pay cuts. As I understand it, if MAG wins an 1113 motion the judge will grant the right for MAG to reject the contract and impose new pay rates and work rules.

The pilots may never have a chance to vote on it. What is worse, the judge may also prevent MAG pilots from seeking self help, ie they lose the right to strike. Look what happened to Comair Flight attendants.

If/when this happens I hope nobody blames the MAG pilots.

 

[DoinTime]

The problem will NOT be the pilots "voting: for pay cuts. As I understand it, if MAG wins an 1113 motion the judge will grant the right for MAG to reject the contract and impose new pay rates and work rules.

The pilots may never have a chance to vote on it. What is worse, the judge may also prevent MAG pilots from seeking self help, ie they lose the right to strike. Look what happened to Comair Flight attendants.

If/when this happens I hope nobody blames the MAG pilots.

It is EXTREMELY difficult for a company to be granted authority to impose contract terms through the 1113c process. The threat of getting a contract rejected is what brings labor to the negotiating table and in nearly all cases a consensual outcome on a restructured labor contract is reached.

 

[rene]

It is EXTREMELY difficult for a company to be granted authority to impose contract terms through the 1113c process. The threat of getting a contract rejected is what brings labor to the negotiating table and in nearly all cases a consensual outcome on a restructured labor contract is reached.

I think we are saying the same thing. I can't imagine why the MAG creditor's committee wouldn't play that card? If for no other reason than to bring labor to the negotiating table and reach a "consentual outcome". I don't think for a minute, that ALPA on the committee will make any difference.

Now that the Aiway's 900's are out for RFP, I believe it is virtually certain that MAG will come to the pilots for a "contribution" in "exchange" for an extension with airways. The aircraft lessors and us "pilots" are the only players who can make it happen. If we don't?

The lights will be out in 2012. Its as simple as that. Anyone want to play a game of chicken?

 

[sniper]

We can and we should expect MAG to file an 1113 motion to reject the ALPA contract. The creditors committee will require it as a condition of the POR and a potential contract exptension with Airways.

The reality is that the company and ALPA will agree to concessions in the 10-15% range. That is $10 - $15 million savings per year for 4-5 years. Translation? At 6 times EBITDA that is $90 million in value and nobody will just leave that on the table

My 2 cents

It will never happen, I am very sure of that.

 

[sniper]

We can and we should expect MAG to file an 1113 motion to reject the ALPA contract. The creditors committee will require it as a condition of the POR and a potential contract exptension with Airways.

The reality is that the company and ALPA will agree to concessions in the 10-15% range. That is $10 - $15 million savings per year for 4-5 years. Translation? At 6 times EBITDA that is $90 million in value and nobody will just leave that on the table

My 2 cents

Dont you have a new MEC leadership? are they jos boys or what

 

[dowhite2]

Rene,

You do realize ALPA is the co-chair of the creditor committee, so I highly doub't they'd demand labor concessions. Additionally management has stated several time and in the initial Bk filings that the petition was soley to get rid of excess aircraft and that labor costs were not the problem.

 

[rene]

Rene,

You do realize ALPA is the co-chair of the creditor committee, so I highly doub't they'd demand labor concessions. Additionally management has stated several time and in the initial Bk filings that the petition was soley to get rid of excess aircraft and that labor costs were not the problem.

I hope you are right but many of us just do not believe it. ALPA being co chair is little comfort if Bombardier, and Embaer want concessions. When Airways says they will extend the contract if they get concessions of X, what will the creditors committee do? The alternative is to terminate the contract in 2012? The RFP is out and so now we will wait to see what happens.

My bet is that pilot concessions will be requested, if they are not granted, we will be blamed for shutting down the airline.

In either case its not a pretty picture.

 

[Metro752]

You guys cannot give a dime back. When are you stooges going to learn that your salary is only a small percentage of the operating costs.

GMAFB!

 

[Broke in CVG]

I hope you are right but many of us just do not believe it. ALPA being co chair is little comfort if Bombardier, and Embaer want concessions. When Airways says they will extend the contract if they get concessions of X, what will the creditors committee do? The alternative is to terminate the contract in 2012? The RFP is out and so now we will wait to see what happens.

My bet is that pilot concessions will be requested, if they are not granted, we will be blamed for shutting down the airline.

In either case its not a pretty picture.

If you guys are blamed for shutting down the airline, I will gladly buy a round for ALL the Mesa guys/girls.

 

[rene]

If you guys are blamed for shutting down the airline, I will gladly buy a round for ALL the Mesa guys/girls.

I am sure you will buy everyone a drink. But, if you stop and think about it, when the music stops, Delta will be gone, and UAL will begin winding down in 2012. By then Go, will probably be gone, so all that will be left is the 38 - 900's for Airways.

That will leave roughly 400 pilots at MAG, There are 1100 today. These folks will obviously be the most senior will have by far the most to lose.

Here is the logic, these 400 pilots will cost MAG about $35 million. A 20% pay cut will contribute about $7 million to the cause (or about $200K per aircraft). The engine and aircraft lessors will then kick in another $800K and we MAG get a five year contract extension for the $1 million price reduction per aircraft.


The alternative is 400 more unemployed pilots, 38 old airplanes sitting idle and about 90 surplus engines. That's a very bad outcome for the pilots and the lessors.

Anyone want to take that bet?

 

[CLARKGRSWOLD]

I assure you no pay cuts will be taken at Mesa. There is no way in Hell a BK judge would say... Ya labor, that is why you are in BK. Give me a break RENE.

 

[rene]

I assure you no pay cuts will be taken at Mesa. There is no way in Hell a BK judge would say... Ya labor, that is why you are in BK. Give me a break RENE.

I hope you are right, but I think you missed my point. The gun to our head will be held by Airway's not by the judge.

This is how it will play out. Airway's will get a bid(s) from their recent RFP (which is already out there).

If Mesa doesn't meet that number, the contract will simply expire in June of 2012. The only parties who are in a position to negotiate a reduction are the pilots and the lessors. Everybody else will have to match whatever the pilots agree to give up anyway and it won't really matter.

So what I am saying is that in this game of chicken, my bet is that the 400 pilots will make concessions before they lose their jobs.

Again, I hope you are right. I feel badly for the many wonderful people here at Mesa, but whatever happens, will not impact me personally, because I will be gone by then.