AMR selling Eagle

[siucavflight]

AA can't just codeshare with anyone for domestic service, wholly owned or not. They would have to negotiate with APA to do that. For example, the horizon and alaska codeshare. Fortunately the scope is pretty clear on this.

What I worry about is that the way that the APA contract is worded it says that AE will be their only regional. Then it goes on to discuss scope as applying to wholly owned only. If Eagle is separate from AA then it would get them around the scope. As I said in another thread I will absolutely not allow myself to be used to whipsaw anyone, EVER! Good bye AE.

 

[lookin4better]

EVER?

Nothing personal, but AMR has been 'whipsaw-ing' AA with AE for years now.....ask a flowback the next time you fly with them.....again nothing personal. Its just a matter of perspective...

I used to fly there ( AE) too....so I guess I am just as guilty. However, what else were we suppose to do? They gave that flying up right?

 

[AA717driver]

siucav--First, may I say you have consistently posted the best avatars on the board. Kudos!

Second, if the scope only covered Eagle/wholly-owned regionals, why isn't TSA or CHQ flying anything larger than 50 seaters?

BTW, I've always wondered why that flying didn't go to Eagle anyway.

There is a section in the GB on non-wholly-owned flying but I'm too lazy to look it up now. Besides, if AMR wants to try to bust scope, they will do it without the permission of any of us. Good luck to all. TC

P.S.--You heard it here first (well, maybe not...): I'm predicting AMR will push APA to strike in order to go Ch. 11 and 1113 the unions. This is a first step.

 

[WyoHerkdriver]

Pushing for bankruptcy? Let me give you a few reasons whey they DON'T want that.

1) A large part of management compensation in recent years has been in the form of bonuses based on the value of AMR stock. What kind of bonuses do you think they will get with a worthless stock?
2) Another way they squeeze money from AMR is through generous stock options. Again, what will be the value of those options with a worthless stock? A big zero.
3) What about those outside the company that own the stock? How mad will they be when they lose virtually everything in a bankruptcy? Do you think many managers will keep their jobs after allowing the airline to go under?
I could go on an on, but it is clearly NOT in the best interest of management to force the airline into bankruptcy as it will cost them in the wallet and it may very well cost them their jobs.
I can't believe we are talking about bankruptcy yet again at AMR.

 

[JohnDoe]

1) A large part of management compensation in recent years has been in the form of bonuses based on the value of AMR stock. What kind of bonuses do you think they will get with a worthless stock?

Thats easy. They'll just get a brand new "thanks for getting us out of bankruptcy with your amazing leadership" bonus. You actually think bankruptcy will stop their money?? NWA's ceo got roughly 26 million in bonus money when they got out of bankruptcy.

...clearly NOT in the best interest of management to force the airline into bankruptcy as it will cost them in the wallet and it may very well cost them their jobs.

Again, NW's management is alive and kicking with their fat wallets and their job's intact.

 

[WyoHerkdriver]

I hate to break it to the bankruptcy conspiracy theorists, but the bankruptcy laws have been changed drastically in recent years. Thanks to the outright abuse of the system by the likes of UAL, NWA, DAL and others, it now takes a much higher standard for a corporation to declare bankruptcy. The aforementioned airlines used the bankruptcy laws and courts as a tool to gut contracts (including union contracts), but the new laws are designed to prevent that from happening again. Besides, it will be very tough for AMR to approach the bankruptcy threashold given solid profits and a great deal of assets.

 

[AA717driver]

Herk--I know the laws have changed. That's why it will take a strike to drive AMR to that point. I guarantee Arpey goes to sleep every night wondering why the heck they didn't file in '03. (In fact, I ran into a lawyer who worked on TWA's and UAL's Ch. 11's and she basically said it was irresponsible that AMR didn't file when they had the chance.)

They can still make their 1113 case based on competitor's contracts. PBS and Defined Contribution Plan are industry standard these days. We're already at the top of scale for the Legacies--SWA and the cargo guys are higher but they'll make the case that they aren't the competition. They can make the case that we have the lowest productivity of any pilot group out there. It'll be like shooting fish in a barrel.

As for the shareholders, all they do is beat the crap out of management over "unlocking shareholder value" (hedge funds are the new corporate raiders...) and the employees beat them up over bonuses.

At least that's what I'd do if I were king--or at least on the PUP mailing list. TC

 

[afhercdriver]

I hate to break it to the bankruptcy conspiracy theorists, but the bankruptcy laws have been changed drastically in recent years. Thanks to the outright abuse of the system by the likes of UAL, NWA, DAL and others, it now takes a much higher standard for a corporation to declare bankruptcy. The aforementioned airlines used the bankruptcy laws and courts as a tool to gut contracts (including union contracts), but the new laws are designed to prevent that from happening again. Besides, it will be very tough for AMR to approach the bankruptcy threashold given solid profits and a great deal of assets.

You sound just like an accountant. Hi Andrew

 

[EMB170Pilot]

I wonder how much 70 seat flying RAH will get

Hmmm

 

[hoover]

Details are comming out slowly but CNBC just announced that AMR is going to sell Eagle by the end of the year.

To who? Who is going to buy it? Just because it's for sale doesn't mean someone is going to buy it.

 

[igneousy2]

Exactly my point, this is not good. I will not stick around Eagle and allow myself to whipsaw that APA, I will not do it. I hope it does not happen. I dont want to be a career regional pilot. I am out of here as soon as the right offer comes.

You owe APA nothing. You must be fairly new at Eagle. Don't be a fool... APA had the opportunity to stop the craziness in St. Louis and they DIDN'T. You must not have been around when APA launched there anti-Eagle campaign in 1999-2000. Ask an AA pilot who the best AMR pilots are...he probably still has his badge. Ask the TWA or Reno pilots how they feel about these guys you are so disgusted you are being whipsawed against. APA does not care about you, me, this industry, or this profession. They are just looking out for number one....not that I can fault them for that, but you owe them NOTHING.

Going to a major does not have the benefits it once did. It might be easier to bring wherever you are the little baby step up to the majors then it would be to start all over at the bottom of the list of a major. If I got to do it again, I wouldn't leave Eagle unless I got on with UPS or FDX.

 

[siucavflight]

I am not saying that I owe APA anything. I am a regional pilot aspiring to be a mainline pilot. I want to keep the mainline flying where it should be and the regional flying where it should be. If I want to fly a 100 seater I would much rather do it a the A pay scale.

 

[Draginass]

If you want the A scale, you're going to have to look to SW, FEDEX, or UPS. All the rest vary between "B" such as AA and much much lower.

 

[TAWS]

AA scope applies to everyone - CHQ was getting fined something in the region of $30K/day for flying EMB170s for UAL. That's why they purchased Shuttle America. They later purchased MidAtlantic and renamed it Republic, but that's another story. AE is one of the most expensive labor groups out there, having CHQ and TSA onboard SAVES AAL a boatload of cash. If AE were forced to compete, you can wave goodbye to the big paychecks and soft time. BTW, RAH is getting out of the 50 seat market, so I doubt they will be interested in AE.

 

[igneousy2]

Big paychecks! at eagle! hahahahahahaha!

Please!

Eagle crews are more expensive because there Captains are way more senior than Republic, et al. A little bit of rapid expansion and that should close the gap quite a bit. No matter what, I don't think AA will have it's fingers completely out of Eagle and through the sales agreement or otherwise make it so that Eagle continues providing cheap feed to AA. After thinking about this, I think this divesture will be more of a paper transaction than anything.