Airtran Contract

LeonPhelps

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On airlinepilotcentral.com it says that the Airtran Pilot contract expired in March 2005. Anyone have any info on how the negotiations are going? Any ideas on what the new contract may hold?

Thanks!
 

-9Capt

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The contract was amendable April 05.

How are things going? About how you'd expect, nowhere. The company has basically refused to meet and we're headed to federal mediation.

Nobody will stand in awe of the next contract. We expect to see the scheduling language cleaned up a bit and a moderate increase in pay and retirement (cost of living plus a few percent). I have faith in the current union leadership and negotiating committee. They have been collecting a lot of info from the membership from an outside company (Wilson polling group) via telephone and internet.

There are a few things I'd personally like to see (improved reserve rules, reimbursement of the 9/11 concessions, profit sharing, 3-4% B-fund increase and 4-5% year over year pay increase, better grievance process, scope protection, draft/junior manning protection, real time trip trades).
 

-9Capt

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I pulled this off the union website. Interesting...

Topic: AAI Earnings Call Summary National Pilot's Association Date: 07/28/05




“We’re certainly willing to make changes and adjustments to improve the quality of work life of our pilots and the financial situation of all of our employees. We have been very generous in sharing that as the company has grown and prospered and we will continue to do that.” – Joe Leonard, AirTran Earnings Call, July 26, 2005
“Our contract with our pilots today is really quite rich, compared to a number of other airlines around. When we negotiated our last contract we gave very, very substantial increases and those looked like a good deal at the time.” – Joe Leonard, AirTran Earnings Call, July 26, 2005


AirTran Airways Quarterly Earnings Call
For those of you who missed AirTran’s quarterly earnings call last Tuesday, here is a brief review and highlight. We encourage you to listen to the web cast yourself by clicking the ‘Go’ link on the members homepage at the NPA website.

2 nd Quarter Financial Results

Second quarter 2005 net income was $11.4 million or $0.13 per diluted share compared to second quarter 2004 net income of $16.8 million or $0.18 per diluted share. Year-to-Date Income is $3.3 Million or $0.04 Per Share. The second quarter posted a Record Revenue of $366.3 Million as well as All-Time Record Passengers and Load Factor. Non-fuel operating cost per ASM decreased 5.3 percent during the 2005 quarter to 6.20 cents. Second quarter cash equivalents was $376 million compared to $342.3M December 31, 2004.

Revenue passengers 4,295,783 3,427,809 25.3
Revenue passenger miles (000s) 2,909,512 2,175,046 33.8
Available seat miles (000s) 3,844,783 2,884,874 33.3
Block hours 94,991 75,182 26.3
Passenger load factor 75.70% 75.40% 0.3 pts.
Break-even load factor 72.00% 67.70% 4.3 pts.
Average fare $82.34 $77.58 6.1
Average yield per RPM 12.16 cents 12.23 cents -0.6
Passenger revenue per ASM 9.20 cents 9.22 cents -0.2
Operating cost per ASM 9.02 cents 8.46 cents 6.6
Fuel price neutral cost per ASM 8.03 cents 8.46 cents -5.1
Non-fuel operating cost per ASM 6.20 cents 6.55 cents -5.3
Average cost of aircraft fuel / gal 169.98 cents 110.00 cents 54.5
Gallons of fuel burned 63,693,929 49,922,581 27.6


The Q & A

The financial analysts asked some interesting questions. One analyst followed-up on a statement that AirTran management made last quarter about sub-leasing new aircraft overseas instead of putting them in our fleet. Management quickly backed off of this idea and responded that due to the strength of passenger growth in May and June that issue was now on the backburner, meaning all new deliveries will be coming to AirTran.

Another analyst asked a few questions about our contract negotiations. The analyst’s first question was about which pilot contracts and which carriers did AirTran management want to use as comparables to our contract and which pilot contracts, and carriers, did we want to use as comparables for purposes of negotiations. As opposed to paraphrasing, the following is a transcript of CEO Joe Leonard’s answers:

Leonard:

“I don’t know that we really got into comparables at this point. Our position is we need to be sure our unit costs don’t go up. We’re certainly willing to make changes and adjustments to improve the quality of work life of our pilots and the financial situation of all of our employees. We have been very generous in sharing that as the company has grown and prospered and we will continue to do that. But, we also need to remain very productive, as we have been. And so, to the extent that we need to make adjustments and keep our unit costpretty close to where they are today, we think we’ll get there. And that’s kind of our starting point.”

We remind you that, no matter how you slice it, this pilot group is currently one of the least expensive pilot groups in the industry.

“We don’t really pay much attention to some of the other airlines and what’s going on there, we pay attention to what we think we need to do to be successful here.”

“Our contract with our pilots today is really quite rich, compared to a number of other airlines around. When we negotiated our last contract we gave very, very substantial increases and those looked like a good deal at the time. As the other airlines have come down we are much closer, but we still remain much more productive.”



Analysts : And where are the pilots pushing? Are they pushing on the benefit side, the productivity side, the pay side?

Leonard :

“Well, we don’t know. We’ve only seen three sections from them. We’ve asked them for a complete package and thus far they have refused to give us that. They’ve only actually given us three sections, which is a pretty skinny look at what they are looking to achieve.”

Captain Philpot has made numerous attempts to meet with Joe Leonard to discuss among other things, Labor / Management relations, outstanding grievances and Contract Negotiations. To date, Joe Leonard has refused to meet with Capt. Philpot. So, when he says they “don’t know what the pilots are looking to achieve”, it is because they have made a concerted effort not to know. If they knew, they would probably be negotiating as, based on our polling, this most likely will be the most reasonable contract they will ever have the opportunity to negotiate.
The Section 6 process started in early December. Since then, there have been only 6 ½ days of negotiations. Only the first two-day session in January was spent discussing NPA’s opening proposals for Section 3 and 6 changes. The Company has never responded to those proposals. Instead, the Company has shifted the discussion to its concessionary proposal. The remaining 4 ½ days (February 9, March 9-11 and for ½ day May 16) were spent discussing the Company’s proposal. (The Company cancelled the April meetings.) These discussions have been totally unproductive, in part because the Company has refused to provide the requested data to allow us to determine if the Company’s demands are justified.

The NC, at the direction of the NPA BOD, has been consistent in its policy of not providing a comprehensive opener. The company was told this in January, and many times since. We will negotiate at the table face to face, not by mail. We will negotiate point-by-point, provision-by-provision, section-by-section. We will not be hurried into settling a half-baked contract. We will do it right. The pilot group's interests will be protected.
 
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