AA now wants costs cuts

[mannyaplus11]

Good one
"But, how can these top notch management teams keep all of these fantastic people if they dont give them all of the million dollar bonuses????? I mean, come on!!! They will leave and go on to destroy another airline then!!! We just cannot afford that.....:nuts:"

 

[Falconjet]

Let me see if I have this straight.

You feel that it is only right that the guys currently on property give up their pensions and wages so that you can have your job back. You decry them for thinking only of themselves.

Well who are you thinking about when you demand they take less so you can come back?

Sounds sort of hypocritical to me.

Rather than be so quick for everybody else to cave in, why not decry those companys who have reneged on the pensions and those who attempt to undercut the industry by not even offering them?

We should be politicing for every company to have an A and/or B fund, not asking more pilots to give theirs up so you can come back to work.

Just my opinion, no offense meant.

FJ

Allow me to clarify.

I think the A and B funds will eventualy be gone for good. If other companies don't have them, we can't afford them. Neither can CAL. Basic math. The writing is on the wall, but some folks don't want to read it.

Here is my thought with the "evil" b-scale:
Lets say you get hired at American for the same pay/benefits as Jetblue. Right now that sounds pretty good. A lot of folks would be happy to have that job. Sure beats American Eagle. If things get better in 10 years, the union negotiates to get rid of the b-scale just like last time. If things never improve, Jetblue pay/benefits are the new standard.

Why is that such an evil idea?

 

[kjokmo]

Hey good news, even if the Air Traffic Controllers turn down their present contract, congress can force them to accept a contract that pays the avg. controller 187000 a year.

What are you talking about?? What do you mean turn down their current contract? The controllers would love to just keep their current contract. And 187,000 average.....your kidding right. Take a look at the contract and then tell me that again. You had me rolling in laughter though, thanks for the laughs.

 

[Big Slick]

I would like to retire with an A and B fund too, don't get me wrong. It's not my fault that everyone else besides American and Continental either never had a good retirement or dumped theirs on the government.

I saw a story about GM the other day on 60 minutes. It costs GM $1400 per car to pay for the medical insurance of current and retired employees. Auto makers in Japan and Germany have zero medical insurance costs because those costs are coverned by the government.

So, everytime GM builds a car, they have an automatic $1400 disadvantage just for medical insurance. If you include the cost of retirements, salaries, etc., it is no wonder GM is about to go out of business.

Is it unfair? Yes. Does it suck? Yes. Were the good ol' days of Detroit better? Yes. Is the U.S. middle class shrinking? Yes. Is it the new reality for GM? Yes.

The CEO of GM said he needed to cut costs - especially to retirees - in order to save the company. Of course, the UAW freaked out.

Unless they cooperate and slash costs now, there are two possible outcomes:
1. GM files bankruptcy and dumps the retirement costs on Uncle Sam. GM is saved. Our national debt sinks to record lows.
2. GM goes under.

Simple math. It sucks, but that's the way it is.

If Jetblue, Southwest, Virgin America, Air Tran, United, Delta, Northwest, U.S. Airways don't have an A or B fund and American does, this obviously creates a competitive disadvantage.

If you want to point fingers at anyone, point fingers at the LCC pilots who drug down the entire industry. Don't point fingers at me for stating the obvious.

 

[FlyBoeingJets]

Why is that such an evil idea?

Whoa there pardner....I didn't say anything of the sort. I merely pointed out you will receive little support for your idea, no matter how much it makes sense.


You are proposing major cuts to pilot compensation. There is precedent in how favorably that is looked upon.

 

[Big Slick]

No offense taken. You actually said good post earlier. You seem to like my posts beter when I'm not slamming SWA! LOL

 

[OARfan]

So, everytime GM builds a car, they have an automatic $1400 disadvantage just for medical insurance. (quote)


Hmmmmm, yeah now if we could just get those 12 million documented illegals to pay medical insurance it might only cost $1000 per car?

 

[Draginass]

GM execs will now ask the for the assembly workers to work for $3 an hour, like the Chicoms, in order to be "competitive." . . . And the republicans and democrates with think this is fine.

In my opinion, both parties are selling out Americans and pandering to the corporate elite. The businessmen want a flood of immigrants to drive down labor costs. The political and corporate elite are in bed together on this one. The losers? The working man.

 

[jwes]

Good thread guys/girls... I especially like "Ways to save money by cutting AA medical".. In MHO, AA medical is a total waste of money.

I'm American eagle but I think; Yes, screw the most junior guy at AA to save the pension and pay at AA. Why? because he/she has the best of both worlds. Let me explain.... When senior enough they can hold cpt. at AE, not bad 70K. They are certainly experience enough to look for flying work at other places, to have been hired at AA. So get on with jetB, SW or Cont. until AA starts to recall or AE gets you that Cpt. spot on the jet.... Same pay all around. As a furlough pilot you also get some preferential hiring considerations. I realize that having AA guys come back to AE hurts me, but hey maybe I'll get some 170s , 190s out of the deal.....I see their are some pilots that have been furloughed from AA for 5 years.... Give me a break... If your not flying for someone else, your pathetic....

 

[Dangerkitty]

American Air CFO says labor costs must be cut more
Wed Apr 5, 2006 4:02 PM ET
NEW YORK, April 5 (Reuters) - American Airlines' new chief financial officer said on Wednesday the carrier needs to cut labor costs further to stay competitive, even while hewing to the union-friendly strategy it has adopted in recent years.
AMR Corp.'s (AMR.N: Quote, Profile, Research) American won major concessions in 2003 after flirting with Chapter 11 bankruptcy filing but has since insisted that further pay cuts were off the table as it sought suggestions from unions on non-wage related cost reductions and revenue increases.

The No. 1 U.S. airline in the fourth quarter had higher unit costs than Continental Airlines (CAL.N: Quote, Profile, Research) and UAL Corp.'s (UAUA.O: Quote, Profile, Research) United Airlines and various discount carriers but lower than some other traditional carriers.
But with Delta Air Lines (DALRQ.PK: Quote, Profile, Research) and Northwest Airlines (NWACQ.PK: Quote, Profile, Research) slashing wages in bankruptcy, it may soon end up with the industry's highest expenses.
"The other airlines by virtue of the bankruptcy court have reduced their labor costs below where ours is today," said Thomas Horton, who returned as AMR's CFO after leaving nearly four years ago to take a similar job at the old AT&T Corp. (T.N: Quote, Profile, Research). "That represents a competitive problem."
Still, Horton, speaking in a conference call, said any attempt to cut labor costs would only happen within the context of the labor friendly approach the airline has followed.
"I think the strategy of engaging labor is really the only strategy there is," said Horton, who succeeds James Beer, who announced last month he was leaving the airline holding company to join software company Symantec Corp. (SYMC.O: Quote, Profile, Research).
Horton, who was part of a management team which oversaw AT&T's acquisition by SBC Communications Inc. last year, also said the airline industry could benefit from consolidation.
"It is an industry that probably has too much capacity," he said. "It's probably too fragmented."
But he said no major deals were likely any time soon, especially involving American, because of airline mergers' inherent complexity.
The problems of integrating labor forces and aircraft fleets have loomed as sticking points in many past deals.



Bye Bye--General Lee

How is this ground breaking news????

I guess misery loves company.

 

[Gorilla]

It's the never-ending cycle of pay cuts between carriers.

One carrier lusts after another's unit costs. Pay and benefits are crushed. Another carrier says "Hey those two have lower costs than us! Slash our own labor or we can't compete!" etcetera.

The end result?

American Air CFO says Pilots must pay to work
Wed Apr 5, 2008 4:02 PM ET
NEW YORK, April 5 (Reuters) - In a stunning and prescient move, AMR's top executives have agreed that pilots must pay cash to be allowed to continue working. A new contract has been written, and will be imposed by Judge Kendall, calling for negative pay scales, a first in the industry. Before signing in for a 777 trip, the cockpit crew must place on deposit the equivalent of $100 per flight hour, which may be deducted from a credit card. "We have placed credit card terminals in operations. Before a flight plan will print, all of the credit card information for each pilot must be on file. A credit check will be run, and any cockpit crewmember with insufficient credit will be removed from the trip. This will not cause disruption, as there are thousands of pilots on standby who will gladly pay to fly our big, shiny jets." Other carriers are studying this new development in labor costs. The APA could not be reached for comment, as they are all at work at Home Depot or McDonalds, attempting to generate enough cash for their next trip.

 

[Vastly Underemp]

JWES....YGTBSM

Here's the best of both worlds for ya. I've been furloughed from AA for 3 1/2 years now. I was never offered flowback to Eagle, and as a matter of fact the "senior" guys at aa/apa specifically crafted a sideletter to the contract to prohibit me and my bretheren from taking advantage of this contractual right. These oh-so-benevelent leaders of my labor group went out of their way to DENY ME what they so graciously had negotiated for their "real pilots", even though I was legally covered by their working agreement. So rest assured this opinion of mine is from first hand experience. And that is F**K THEM.

 

[smellthejeta]

What are you talking about?? What do you mean turn down their current contract? The controllers would love to just keep their current contract. And 187,000 average.....your kidding right. Take a look at the contract and then tell me that again. You had me rolling in laughter though, thanks for the laughs.

I kinda agree with this man above. The fair lady at 800 Indy wants to royally screw the contract over this time around. This fight I actually have a dog in, and there is SO much rhetoric being tossed around, I really have no idea what the government is really willing to settle for.

What I will say is this: A mandatory age 57 retirement, deteriorating retirement benefits, AND the possibility of a mx slary of $80k or so? I might have to take a pass on this job. Why? Any realistic retirement numbers I'm running now all but require a 40-year career. If my career is capped at 30 years, and I have neither the pay nor the retirement plan to match it, I may have to take a pass on this job. Having to switch careers at age 57 just ain't something I want to think about.

 

[AMRCostUnit]

I think the A and B funds will eventualy be gone for good. If other companies don't have them, we can't afford them. Neither can CAL. Basic math. The writing is on the wall, but some folks don't want to read it.

I know you haven't been around a while but you must delve into the details about the A Fund. Are you aware that our A Plan is almost self-sufficient? The higher the interest rates the better off the plan is. The A Fund has been very well managed by AA. It would cost milliions to covert it to a Defined Contribution plan.

Why would we give away something of great benefit to us when it costs the company nearly nothing?

We were on a track to make changers work smarter and more efficient but the management money grab derailed that process. But, as a whole, the pilots of any airline can't give enough to make the company profitable. Management is using the leverage that they have to do the "Pilot Limbo" as in how low can you go. As soon as the bottom is found (where ever that may be) then the ticket prices will come up. AA carrries 90 million pax a year, so just $10 is an extra $900million. That is the LLC dilema; a fare raise is good for them but far better for us.

Unit
Limbo Hater

 

[Rez O. Lewshun]

Big Slick,

Great post. Always, Always think about what the senior dudes want to do to the pilot group. They try to sell the membership on "improvements" for everyone but the reality is they want to help the senior dudes the most. Don't trust them.

Especially since FO's have no vote....oh wait that was fifty years ago.

Atleast FO's have a 1/2 vote. Nope....nope... that was decades ago....

You mean to tell me that FO's are fully represented equally? Everyone gets an equal vote!

It is called democracy and politics. Everyone is going to look out for their best intrests. The tricks is to get a political movement of your ideas. Let it build then use that momentum to influence the other factions. It happends all the time in this country.....

p.s. Women can fly too.

 

[Big Slick]

AMRCostUnit,

If the A fund is self sufficient at AA, I am just as happy as everyone else to keep it. Believe me I would love to have that money when I retire. I just want AA to be competitive.

I have no idea how to stop the spiral to the bottom that we are all in. I don't think stick full aft, opposite rudder and then stick full forward will work in this case. Maybe the Delta guys can eliminate the stall and yaw. Hopefully they won't smack the ground trying to do it.

Just wait until Ryanair gets over here. How far down can things go? I guess we're all going to find out.

 

[Falconjet]

AMRCostUnit,

I have no idea how to stop the spiral to the bottom that we are all in. I don't think stick full aft, opposite rudder and then stick full forward will work in this case. Maybe the Delta guys can eliminate the stall and yaw. Hopefully they won't smack the ground trying to do it.


Here's a hint: Offering up other people's A and B plans so you can work for less isn't going to do it.

Raising fares and actually managing the airline might.

But then again it might not.

I for one would like to see ANY airline give it a try.

FJ

 

[Crack-Ed]

New hires........

He He... Manny said Newhires.

 

[Big Slick]

Here's a hint: Offering up other people's A and B plans so you can work for less isn't going to do it.


Dude, you missed the whole point. I'm offering up MY A and B fund too.