Will The AirTran Pilots' Windfall Be A Consideration?

[Lonestar]

I know there have been a number of opinions on the AT pilots' windfall and its relevance during SLI. Some have stated none of the numerous gains for the AT pilots can be considered during arbitration. A friend of mine from Chautauqua sent the results of their arbitration with Shuttle America. It was a 24-page document so I took several relevant quotes from the arbitrator in his summary and explanation.

>>>Arbitrator- Richard R. Kasher, Esquire
October 19, 2005

"It is clear, when one considers routes flown, cities serviced, the two carriers' relative financial condition, fleet size and fleet type, that the equities weigh so heavily on the side of the Chautauqua Pilots as to virtually obliterate any alleged equities that the Shuttle America Pilots claim they bring to the merger."

"Simply stated, the rates of pay, rules and working conditions in the Chautauqua Pilots' collective bargaining agreement, are far superior to those found in the Shuttle America Pilots' collective bargaining agreement. As a result of the acquisition Shuttle America Pilots will be the beneficiaries of the superior rates of pay, rules and working conditions found in the Chautauqua Pilots collective bargaining agreement."

"A date of hire seniority integration, while it might not significantly dilute the seniority of the Chautauqua Pilots, would, to some extent, constitute a WINDFALL BENEFIT for the Shuttle America Pilots."

"This Arbitrator agrees that the "reasonable" career expectations of the two pilot groups is the benchmark for determining what is fair and equitable in this case."

"On this basis alone, the integration of Shuttle America Pilots into the Chautauqua operation has substantially increased career expectation for the Shuttle America Pilots, far beyond what they could have reasonably expected when they "signed on" as pilots for Shuttle America."<<<

The arbitrator accepted the Chautauqua Pilots' proposal and as a result, the most senior Shuttle pilot was inserted at approximately 70% seniority and the Shuttle captains DID lose their seats.

 

[redflyer65]

50-80% increase in pay. Sound about the same?

 

[scoreboardII]

In 3


2


1.....

 

[redflyer65]

The Airtran guys have consistently said the NO PREVIOUS rulings have included pay and work rules...

Really?

 

[Angus]

More SWA Pilot fear mongering....

The recent Chautauqua/Shuttle America seniority integration similarly demonstrates the central importance of career expectations. Shortly before the merger, Shuttle America had emerged from bankruptcy and was slowly recovering from a “dire financial situation” that had put the airline in danger of liquidating.

Shuttle America had little prospect of transforming into a profitable airline because Shuttle America’s fleet was outdated and the company had no plan for replacing it.

In contrast, Chautauqua had a solid business model, and its business and fleet were growing. It was slated to add new aircraft to its fleet during the coming years.

The Shuttle America fleet and route network were clearly inferior to Chautauqua’s fleet and network.

Moreover, as here, the Chautauqua pilots’ pay rates, benefits, work rules,
and working conditions were “far superior to those found in the Shuttle America Pilots’ collective bargaining agreement, an agreement that was virtually imposed upon the Shuttle America Pilots as the Shuttle America Pilots’ understandably recognized Shuttle America’s poor financial condition.”

Arbitrator Kasher noted the “polar differences between the financial conditions of the two carriers,” observing that “Shuttle America Pilots had to harbor a reasonable sense of anxiety concerning their future in view of Shuttle America’s tenuous financial situation.” Thus, placing all Shuttle America pilots in the bottom third of the seniority list—far lower on the list than either a date of hire or status/relative seniority placement would have placed them—was fair and equitable.

Both counsel acknowledged that ‘At bottom, the objective is to preserve, to the extent possible, what each group ‘brings to the party’—the pilots’ career expectations at the time they learned of the transaction—and to share equitably the growth opportunities created by the transaction, based on the groups’ contributions to that growth.’ This Arbitrator agrees that the ‘reasonable’ career expectations of the two pilot groups is the benchmark for determining what is fair and equitable in this case.

 

[Splert]

The Airtran guys have consistently said the NO PREVIOUS rulings have included pay and work rules...

Really?

Reno and AMR was all about the contractual gains.

A Reno Captain was just above new hire interms of relative values of the pay and work rules and retirement and health care they brought with them to the integration and that is about where they ended up.

AirTran CAs will lose seats and every Airtran FO will be junior to pre merger SWA FOs but with longevity.

 

[Angus]

This acquisition just eats ALL you Flightinfo yenta's right up..... and that brings a smile to my face.

Continue on with your AAI fear mongering/bashing/kicking in the nuts...... because when it is all settled.... you will finally see that OUR opinions are ALL irrelevant.

Carry on Ladies..... lol!

 

[S3sundowner]

Angus, just to be clear, aai's financial situation is far from healthy. $2billion in debt, $400 mil in the bank, $250m charged in bag and changed reservation fees in 2009. Without those fees, they would have lost $200m in 2009 with an industry trailing contract for the pilots. An oil spike and they'd be closing the doors. Bottom line: the aai pilots' career expectation just went through the roof, even with a full staple and pay protect.

 

[Full of LUV]

Angus, just to be clear, aai's financial situation is far from healthy. $2billion in debt, $400 mil in the bank, $250m charged in bag and changed reservation fees in 2009. Without those fees, they would have lost $200m in 2009 with an industry trailing contract for the pilots. An oil spike and they'd be closing the doors. Bottom line: the aai pilots' career expectation just went through the roof, even with a full staple and pay protect.

I'm as proud of SWA's accomplishments as the next, but some of you make it sound like SWA shats gold coins. Without the fuel hedges, bag fees and a fuel spike, SWA may not be closing but the whole industry will be in for some tough times, again.

 

[Ty Webb]

Angus, just to be clear, aai's financial situation is far from healthy. . . . . . An oil spike and they'd be closing the doors. Bottom line: the aai pilots' career expectation just went through the roof, even with a full staple and pay protect.

Yawn. I have to laugh at you, Sundowner. Let me guess, you came out of the military, never ran a real business in your life, got hired at your first Airline, had unrealistic upgrade intentions, and are now trying desperately to convince people that you, not existing AirTran Captains should fly the AirTran airplanes.

Your "facts" are wrong. AirTran has made more money 9 out of the last ten years, and 2009 and 2010 are banner year. After our operating profits, AirTran paid down debt each year, increased out cash position, and refinanced our debt at lower rates. We are growing, SWA was actually the stagnantg one, but I know those uncomfortable facts don't help your argument.

 

[S3sundowner]

Ty, I knew you couldn't resist. But, to answer my question, did your career expectation just increase as a stapled swa fo with pay protect? Yes or no?

 

[S3sundowner]

BTW, aai guys/gals fly aai airplanes...correct me if I'm wrong. But post-merger, I believe they will be swa airplanes flown by swa pilots. Bottom line: would you take a permanent fence in atl with your seat and pay?

 

[Angus]

I'm as proud of SWA's accomplishments as the next, but some of you make it sound like SWA shats gold coins. Without the fuel hedges, bag fees and a fuel spike, SWA may not be closing but the whole industry will be in for some tough times, again.

What a GREAT post. I agree with you, and I highlighted the IMPORTANT part that I agree with. I am INCREDIBLY impressed with SWA on many levels. Always have been. There is ZERO doubt as to its model and unparalled success.... and IF I worked there, or IF this corporate acquisition goes through... I would/will be PROUD to be part of such a legacy.

With that said... AirTran has done just fine for some time now, we are in fact profitable regardless "how"... and the checks have never bounced. I am EQUALLY impressed with AAI and what it has done in the past decade alone, and I am PROUD to be where I am.

I refuse to debate corporate economics and/or financials. I am a Pilot.... not a CPA or Executive, unlike the dozens of expert posters that sure seem to post on Flightinfo, particularly when bashing AAI.

All I know is that AAI has been good for my career, and has been good for ALOT of Military, Regional, and Furloughed Pilots for YEARS.

The AAI Pilots have helped make AAI "successful" despite itself... and I would argue that THESE are exactly the type of Pilots that will benefit SWA.

The SWA Pilots on Flightinfo who constantly rail on AAI, rail on the AAI Pilots, and their contract, remind me and sound EXACTLY like the same type of people that have bashed SWA for YEARS here on Flightinfo. Now it sure seems like it has become their opportunity to take that same immaturity out on the AAI Pilots.

My... how success spoils the "immature" of elite... at least on Flightinfo. I have yet to meet these same posters out on the line.

 

[Ty Webb]

Ty, I knew you couldn't resist. But, to answer my question, did your career expectation just increase as a stapled swa fo with pay protect? Yes or no?

Of course not, what a stupid question . . .You've pretty much proven my point.

AirTran is in its 15th year. I'm in the top 30%. Where was SWA in 1988? Serving 70 cities? Second largest carrier at the world's busiest airport? International operations? Was that where SWA was?

How about you? What were you doing in 1988? Riding your bike and reading Mad magazine? :laugh:

Give it up already.

 

[DonVerita]

50-80% increase in pay. Sound about the same?

Ha! Get real! Seen our new payrates yet that went into effect with our new contract on Dec. 1st?

Yes, the AAI guys will get an increase in pay when they come in at SWA pay rates, and a fairly hefty one at that...but it won't be at the percentages you posted above.

Just using my 9 yr. longevity as an example, it will be 33%.

And what will we bring with us that will benefit you? Hmmm...how's about:

1. 138 aircraft (as of today), with more arriving in 2011.
2. 50 firm options
3. ATL - the world's busiest airport
4. International routes
5. And here's the gold coin: Critical Mass

We're not showing up hat in hand. The two combined airlines will now have the fire power (aka: Critical Mass) to hold their own against the combined DAL/NWA and UAL/CAL. Furthermore, nobody is taking away any SWA F/O upgrades. Our aircraft that we bring to the table are flown by our pilots. This fear mongering over upgrade times is baseless and pointless and only results in division/animosity where there should be unity. The combination of these two major airlines is going to mean huge growth for all of us.

 

[Ty Webb]

Ha! Get real! Seen our new payrates yet that went into effect with our new contract on Dec. 1st?

Yes, the AAI guys will get an increase in pay when they come in at SWA pay rates, and a fairly hefty one at that...but it won't be at the percentages you posted above.

Just using my 9 yr. longevity as an example, it will be 33%.

And what will we bring with us that will benefit you? Hmmm...how's about:

1. 138 aircraft (as of today), with more arriving in 2011.
2. 50 firm options
3. ATL - the world's busiest airport
4. International routes
5. And here's the gold coin: Critical Mass

We're not showing up hat in hand. The two combined airlines will now have the fire power (aka: Critical Mass) to hold their own against the combined DAL/NWA and UAL/CAL. Furthermore, nobody is taking away any SWA F/O upgrades. Our aircraft that we bring to the table are flown by our pilots. This fear mongering over upgrade times is baseless and pointless and only results in division/animosity where there should be unity. The combination of these two major airlines is going to mean huge growth for all of us.

This bears repeating, but I'm sure it will be lost on the serial posters here:

Furthermore, nobody is taking away any SWA F/O upgrades. Our aircraft that we bring to the table are flown by our pilots. This fear mongering over upgrade times is baseless and pointless and only results in division/animosity where there should be unity.

 

[Just thinking]

SWA is already reaping the benefits from the merger. What were your expectations last summer? (see below)

Southwest Airlines Reports Second Quarter EarningsDALLAS, July 29, 2010 /PRNewswire via COMTEX/ --

"Given the current economic outlook and trends, we continue to approach route expansion through optimizing our flight schedule rather than fleet growth. We remain committed to reaching our financial targets before we return to any significant level of fleet growth. For 2010, our capacity will remain essentially flat with last year. For 2011, we are estimating a modest year-over-year capacity increase with no fleet growth. Although it is too early to commit, at present, we have no plans to grow the fleet in 2012, either. We will continue to monitor trends for changes and are prepared to adjust our schedule, accordingly."

I am happy for the growth for the SWA pilots. With appropriate fences all will be about the same in 3-5 years. The work ethic at AAI is outstanding and you have a professional pilot group that has succeeded IN SPITE of management. SWA has an outstanding work ethic that has succeeded WITH the support of management.

Looking forward to the future.

 

[redflyer65]

Ha! Get real! Seen our new payrates yet that went into effect with our new contract on Dec. 1st?

Yes, the AAI guys will get an increase in pay when they come in at SWA pay rates, and a fairly hefty one at that...but it won't be at the percentages you posted above.

Just using my 9 yr. longevity as an example, it will be 33%.

And what will we bring with us that will benefit you? Hmmm...how's about:

1. 138 aircraft (as of today), with more arriving in 2011.
2. 50 firm options
3. ATL - the world's busiest airport
4. International routes
5. And here's the gold coin: Critical Mass

We're not showing up hat in hand. The two combined airlines will now have the fire power (aka: Critical Mass) to hold their own against the combined DAL/NWA and UAL/CAL. Furthermore, nobody is taking away any SWA F/O upgrades. Our aircraft that we bring to the table are flown by our pilots. This fear mongering over upgrade times is baseless and pointless and only results in division/animosity where there should be unity. The combination of these two major airlines is going to mean huge growth for all of us.

Wow, not sure where to start with this one but I'll do the math.

First off, you have to use your original payscale that was used as a snapshot in Sept. I really like how you guys want to hold up the new one and say 'it isn't that much different now'.

But I'll do the public math anyway..

9yr AAI FO - 75/hr x 70 = 5250/month (original payscale)
9yr AAI FO - 97/hr x 70 = 6790/month (new payscale)

9yr SW FO - 124 trips for pay, mulitpied by a conservative rate of 1.15 (1.18 is closer to reality), equals 142.

142/hr x 70 = 9940/month that's a 90 percent increase off your original pay, or 46 percent increase off your new payrates. (which won't be used)

So instead of 50-80 percent, I should have use 46-90 percent. My bad.

At SW, that same 9yr FO can easy fly 110-115 trips a month making 13,600 for the month. That is the windfall no matter how you add the numbers.

Your 1-5 items are all good for the combined company, but what does the AAI contract bring for Southwest pilots vs the windfall for the AAI guys?

 

[atldc9]

Wow, not sure where to start with this one but I'll do the math.

First off, you have to use your original payscale that was used as a snapshot in Sept. I really like how you guys want to hold up the new one and say 'it isn't that much different now'.

But I'll do the public math anyway..

9yr AAI FO - 75/hr x 70 = 5250/month (original payscale)
9yr AAI FO - 97/hr x 70 = 6790/month (new payscale)

9yr SW FO - 124 trips for pay, mulitpied by a conservative rate of 1.15 (1.18 is closer to reality), equals 142.

142/hr x 70 = 9940/month that's a 90 percent increase off your original pay, or 46 percent increase off your new payrates. (which won't be used)

So instead of 50-80 percent, I should have use 46-90 percent. My bad.

At SW, that same 9yr FO can easy fly 110-115 trips a month making 13,600 for the month. That is the windfall no matter how you add the numbers.

Your 1-5 items are all good for the combined company, but what does the AAI contract bring for Southwest pilots vs the windfall for the AAI guys?

Just a quick question. What is the 9 year TFP rate for a SW FO? To make your above comparison accurate, just do the monthly TFP for SW 9 year FO x monthly guarantee(87?) compared to AAI's number above.

I'm not even remotely saying the SW guy doesn't make more, but your not making an accurate monthly comparison when you use an arbitrary conversion factor and 124 TFP, versus a min guarantee month at AAI.

FWIW

 

[XRMEFLYER]

Don't you guys ever get tired of this? It is out of our hands.

Merry Christmas!