ALPA political strategy

[B1900DFO]

Golden,
I think your figures are off on the Ual 737 capts. I could be wrong but I believe they start somewhere around 180/hr, not sure where they top out.

You keep blaming Alpa for the mismanagement of airlines. When it comes down to it the total cost of pilot salaries is just a fraction of the costs facing a full-service, major airline. However they are probably one of the easiest costs to reduce which is why management is always bitching about labor costs.

But don't take it from me. Here is a direct quote from Donald Carty, "The greatest sin of airline management of the last 22 years has been to say it's all labor's fault (august 12, 2002)." Now do you think ALPA made the CEO of AMR make that statement?

Go read Flying The Line and Flying the Line 11. Great history of management-pilot relations since the inception of the airline industry.

 

[goldentrout]

B1900DFO

You're are correct about the UAL 737 Capt/FO salaries. I will correct my post. I'm getting my figures from Air Incs stuff, and some of my profit info from "Flying Through Time."

As for what the AMR CEO said about not blaming, I agree with him 100%.

The management team that agreed to the employee overhead costs at the major airlines were irresponsible and incompetent in their duties...of which the primary duty is to ensure the profitibality and financially viability of the company in good and bad economic times.

The pilot group at SWA and their management team have had 30 years of profitability. While their compensation package may be only 80% of let's say, UAL...SWA has never furloughed, has always turned a profit, and (according to Flying Through Time, page 86, has morale that "may be the best in the airline industry." Don't forget, SWA profit sharing was 14.5% of their base salary for 1999...that's about 20,000 for top SWA Capts, and 13,000 for top FOs. That's about the same as their UAL counterparts after the 18% pay cut.

If they can do it SWA, they ought to be able to do it at the majors...ALPA and the management teams have no excuses...SWA is doing it, it can be done.

Yes, yes...I've heard that SWA and UAL offers a different product, that SWA is only domestic, that it doesn't have premium service, etc. These are still just excuses...either a company is financially viable, or it isn't . If a company's overhead doesn't allow it to make money on "premium service" and/or "international flying," then they either have to drop those services, or adjust their overhead to make a profit.

I have heard...and I do not present this as fact, only strong as corraborated rumor.

I have it on good authority that a certain number of pilots at UAL get paid $20,000-25,000/month at UAL to do nothing...that's right, they have the whole month off and get $20,000-25,000. They do this four months or so out of the year. That's 80,000-100,000/year per pilot for no work. So let's say 100 pilots at the top of the list can do this...that's 8-10 million/year 100 UAL pilots get paid to sit at home all month 4 times a year.

How does this work? After 25 yrs at UAL, a pilot gets 44 days/year of vacation. Many of the international senior Capts only fly 2 trips a month. Apparently, the current work rules say if you bid vacation, and one of your vacation days touches a trip, you are displaced from the trip without any loss of pay. So these pilots (and I probably would too, if I could) bid 10 days of vacation/month 4 times a year on lines where their vacation touches their trips and presto!...their trips for their four months disappear...and they get their full month's pay.

Additionally, there are probably hundreds, if not a thousand other pilots who use this work rule to only fly 1 to 2 trips a month 4-5 times a year, and still get their full salary. How many millions does UAL shell out every year to pilots who fly 0-2 trips a month, using this vacation work rule, to turn 7-10 days of vacation into 3 weeks to a month off?.

9/11 has given management the upperhand. With the advent of low cost carriers and 50-90 seat RJs, the airline industry is going to revolutionize itself in the next five years...and I'd bet a chunk of change the employee overhead costs will drop significantly in that revolution.

The AMR CEO was exactly right about not blaming labor...whatever major airline management team agreed to the employee overhead in the current contracts, and to work rules like the one above, deserves to be fired.

My opinion...ALPA will not be able to "preserve the profession" unless it becomes a force for a more revenue based compensation package, and for job security for all...not just the top of the list.

 

[B1900DFO]

Golden,
American pilots make significantly less (20%+) than Dal pilots yet the company is losing staggering amounts of money. American's management never agreed to the staggering pilot salaries you keep referencing, yet they are losing 800+ milion a quarter. Are pilot salaries still to blame for Amr's woes? I bet that AMR pilots are paid comparable wages to SWA pilots for similar equipment. Howeer I do give you that SWA pilots are more productive.

By the way if you have such disdain for the majors go to Luv. Then in 15-20 years when you are a captain at SWA saving heavily for retirement along will come XYZ airline whose pilots will be happy to top out at 100K after 18 years. The public will love them because they offer no-frills tickets for quite a bit cheaper than the now over-priced SWA. These XYZ pilots will scoff at those overpaid SWA guys who get more than 10 days off a month and such extravagant benefits as medical and dental insurance.

The USA Today will run articles claiming that SWAPA is crippling the once great SWA with outrageous labor costs that drive the tickets to astronomical prices, even exceeding the cost of driving in extreme cases. XYZ pilots will have quirky, company-guy attitudes and will happily book tickets from home on their days off to trim company costs. The pilots will even pay for their PC checks and soon SWA will be flat-out unable to compete. Even worse, legions of bright-eyed new pilots will look upon you with growing contempt because your outrageous SWA salary is limiting growth and denying their god-given right to a job at the majors. What i'm trying to say is that there is always someone who would be thrilled to do it for cheaper if the job involves flying an airplane. I think we should be the last ones to blame pilots for the state of the industry.

 

[goldentrout]

B1900

My comments do not say that "pilots" are too blame for all the airlines woes.

What my comments do say is that the wage and benefit strategy of ALPA "get as much as we can now and to heck with the financial future of the company...as well as the bottom 20% of the seniority list" hsa significantly contributed the the airlines woes.

According to CNN the other day...labor is 38% of the overhead of the airlines...flight attendant and mechanics' unions too are right in there with ALPA using the same failing strategy. AMR is not ALPA, but their union seems to have that same short sighted mentality, along with scope clauses that "protect" pilot jobs.

I looked up the AMR pay rates on the 737, AMR guys make about $30,000 more/year than at SWA (about $15,000 in salary, and another $15,000 on their B-fund). So yes, AMR management did agree to wages/benefits much higher than at SWA...and AMR management probably agreed to a flight attendant contract much higher than at SWA...and a mechanic contract much higher than at SWA...gate agents...baggage handlers..etc...it all adds up.

You and I can disagree in theory about all this but the facts are

1. Since 1990, SWA has made a profit every year.
2. AMR has only turned a profit 7 of those 12 years.
3. SWA has never furloughed a pilot.
4. Most, if not all of the majors furloughed thousands in 1990-1992, and then thousands more in 2001-2002.
5. SWA is hiring, buying planes and expanding, even in this horrible airline market.
6. The big 4 all over over 1000 pilots on furlough, more furloughs planned, and are losing billions a year.

and don't forget...the UAL MEC just agreed to a 2.2 billion wage cut over 5 years, and the flight attendants agreed to a 450 million 5 year wage reduction.

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Reuters
JetBlue Profit Up, Shares Drop
Thursday November 7, 1:39 pm ET


NEW YORK (Reuters) - JetBlue Airways (NasdaqNM:JBLU - News), the popular low-cost airline, said on Thursday its profit rose and passenger traffic more than doubled in the latest quarter, while most larger airlines reported huge losses.
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But shares of JetBlue dropped more than 7 percent on Thursday as investors worried about a spike in operating costs. The New York-based airline cited rising fuel prices, a buildup of operations at Long Beach airport in California and a spate of credit card fraud that it said is being addressed.

"We were up a little bit on our cost side. But there's nothing endemic about those costs," Chief Executive Officer David Neeleman said in an interview. He said JetBlue's costs in the fourth quarter should drop back to second-quarter levels.

JetBlue said its profit rose to $12.2 million, or 27 cents per share, in the third quarter, from $10.1 million, or 30 cents per share, a year earlier.

Earnings were in line with forecasts of analysts surveyed by Thomson First Call, who expected JetBlue to earn 25 cents to 32 cents per share, with a mean estimate of 28 cents.

The airline's shares were down 7.7 percent, or $3.15, at $37.65 early on Thursday afternoon. JetBlue's stock peaked at $55.15 on May 6 after its initial public offering this spring, but dropped below $30 in October after a lock-up on some of those shares expired.

PRICING POWER IN A WEAK MARKET

Most major U.S. airlines are facing dramatically depressed revenue, with ticket prices low and business travel weak. Neeleman said he had never seen such consistently low airfares across the sector.

While fares have stayed painfully low for most airlines, JetBlue has an advantage both in terms of costs and pricing across its markets, Neeleman said in a conference call.

"One thing that stands out about the airline business is how weak airfares are, that is not the case for JetBlue," said Jim Parker, an airline analyst at Raymond James. "People are paying up to fly JetBlue and it is still a low fare."

The eight largest U.S. airlines posted net losses totaling more than $2.5 billion in the third quarter. Of those eight, only low-cost carrier Southwest Airlines(NYSE:LUV - News) had a profit.

Other low-cost carriers also posted quarterly profits as did most regional airlines, which serve major airline partners by flying from small- to mid-size cities into hub airports.

"(JetBlue has) a superior product that they offer at low fares, and they are the lowest-cost producer in the industry along with Southwest," Parker said. He added that the airline's outlook for the fourth quarter was favorable."

Check it out at

http://biz.yahoo.com/rb/021107/airlines_jetblue_earns_5.html

 

[DarnNearaJet]

The only thing more pathetic than our president getting a hummer in the oval office is the fact that the Republican congress attempted to overthrow a democratically-elected president for lying about sex under oath.

Actually, I'm wrong, there is one thing more pathetic -- someone painting a picture of the entire Democratic political platform over the actions of one man.

Remember Iran-Contra?