APA and the Jetblue pilot committee!

[bluechunks]

The company will be their representative until they get a union so, they can't get stapled, but they could still get pretty heavily screwed.

Why would it even have to go that far? There are several morally evil but plausible ways for the JB BOD to "enhance shareholder value" by not having any strings (i.e. employees) causing issues during a transactional event---particularly when the JB's true financial value is contained in hard assets (terminals, gates, slots, aircraft, ect...)

As an example, every single JB pilot is an "at will" employee per NY labor law -- just ask any of the handful of JB pilots fired over the years. (Hint: this is the precedent used successfully by JB when fired pilots have attempted to appeal their termination.) The JB PEA covers the terms of employment but does not guarantee employment...or even appeal.

 

[jonjuan]

Sounds like a great deal for the couple thousand AA pilots that are out of work.

Gup

They're all out of work?

 

[Skyboy722]

They're all out of work?

You do know how many they have on furlough, right?

 

[JetFumes]

How did it all go down with Reno Air? Is this one of the steps, or something else?

 

[Mach92]

Guppy I'm not so sure about that...furloughed pilots would be placed below flying pilots at the mergered carrier.

Negative ghost rider

 

[Draginass]

Staple job...NO, Date of hire YES

A date of hire would be a staple.

 

[waterski]

Negative ghost rider

Why not?

 

[Beantown]

If a company like AMR wants to get enough shares to control JBLU then the share price will go up, way up. Less shares on the market, higher price, especially with everyone holding their shares to see what AMR will offer as a premium. At least in my mind I don't see jetblue agreeing to a merger, therefore AMR has to buy them, at a premium compared to what they are today. Even at 5.76 a share Jblu is worth 1.7 billion dollars, and it probably has a acquisition value in the 2-3 billion dollar range. Again, I don't see the incentive for Jblu to merge. I can see why AMR would want Jblu, but not why Jblu would want AMR.

Bingo! It's not the stock price , it's the amount of shares outstanding. JB has a lot, and at $5.77, they are very expansive.

For comparison, Airtran is about the same size as JB, there stock price is $4.39 to JB's $5.77 yet they are only worth 594M to JB's 1.7B.

As n757 questions, WHY? No one has answered that yet. They have a new terminal in JFK, they already have a huge presence in JFK, Boston, south FLA, and the Caribbean, if you apply AA's cost structure to JB, you have no chance to make money, different fleets, different products, different cultures, ect ect.

I really can't come up with one reason AA would want to buy JB. Hell AAI would make much more sense for a third the price. Of course this is aviation, so the fact that it should never happen means it probably will.

 

[Yuppyguppy]

Guppy I'm not so sure about that...furloughed pilots would be placed below flying pilots at the mergered carrier.

not true

 

[Flyby1206]

I really can't come up with one reason AA would want to buy JB. Hell AAI would make much more sense for a third the price. Of course this is aviation, so the fact that it should never happen means it probably will.

Just to play devil's advocate.. If AMR bought jetblue then they would be eliminating the most widespread low-fare carrier in the east coast/northeast/caribbean markets. That would raise all subsequent fares for all other carriers operating in those areas, including AMR.

Isnt it AMR's standard operarating procedure to buy the competition then shut them down? (See TWA, Reno, Air Cal, etc)

And a side note, AMR would suddenly gain a HUGE share of the JFK slots. Granted, some of them would have to be given away, but they would no doubt increase their JFK market share over what DAL currently has.

 

[PCL_128]

Why would it even have to go that far? There are several morally evil but plausible ways for the JB BOD to "enhance shareholder value" by not having any strings (i.e. employees) causing issues during a transactional event---particularly when the JB's true financial value is contained in hard assets (terminals, gates, slots, aircraft, ect...)

As an example, every single JB pilot is an "at will" employee per NY labor law -- just ask any of the handful of JB pilots fired over the years. (Hint: this is the precedent used successfully by JB when fired pilots have attempted to appeal their termination.) The JB PEA covers the terms of employment but does not guarantee employment...or even appeal.

That's actually a good point. I think the PEA requires the company to pay the employee for the 5 year term, if I remember right, but being paid isn't a guarantee of employment. They could pay but cancel all of the contracts at the 5 year renewal point. Or, more likely, they could threaten that they're going to do that unless the pilots voluntarily agree to a disadvantageous seniority integration.

Lots of ugly possible scenarios without union representation. Good thing there's an ALPA drive going on at JB. Time for some representation.

 

[Metrojet]

Guppy I'm not so sure about that...furloughed pilots would be placed below flying pilots at the mergered carrier.

a la "Nicolaui"

 

[UpNDownGuy]

Why would AA want JB? Too many reasons to count. The best terminal and most slots at JFK, owning BOS outright, Live TV, eliminating the biggest low cost carrier on the East Coast, a profitable training center...and the biggest reason: to make sure SWA doesn't get JB.

If SWA bought JB, they would immediately own New York. They already have slots at LGA and EWR, and with the JB slots at JFK they would be a major player, instantly. Add BOS to their MHT flights, and most of New England is SW. Throw in the Caribbean/South America and they have an enormous possibility for connections. Live TV makes money on it's own, and would let them catch up to the rest of the industry entertainment-wise relatively cheaply. It's an absolute no-brainer.

Which is why the pilots at JB need ALPA yesterday.

 

[macdu]

Which is why APA is probably paying ALPA to drag their feet on a representation drive if any of this rumor is true. ALPA has always wanted AA back under their umbrella..............it ait gonna happen. But, it's ALPA's wet dream. So APA schmoozes them in to thinking that a solicitation drive is possible but just ignore these JB guys for a while. I am another who can't for the life of me figure out why AMR would want to go down the buy another airline route again, unless it was to dismantle it. Just remember, if AMR buys .......... start looking for another job because the future will not be bright.

 

[AKAAB]

ALPA hasn't been dragging their feet at all and the support we've seen for the 300+ pilots on the Organizing Committee (a record for ALPA) is steady and strong. The card collecting will begin sooner than later judging by the level of support we're seeing in the ranks.

 

[G4G5]

The JFK terminal thing just doesn't make sense to me. Why would AA want another new terminal at JFK after spending millions on one they can't even fill? Granted B6's terminal is located in the best position on the field, it's distance from AA's in a hindrance to moving pax not a help.

If anything I could see Delta wanting B6 just for that reason. They need to spend hundreds of millions on a terminal upgrade, to a terminal that may be made into a land mark. Just apply that money to the purchase of B6 and get the new terminal. Same type Airbus (granted different engines but that's not a deal breaker). Quick way to dump the DC9's.

I hope for the Jetblue pilots that this doesn't happen. AA is a mess and their is no way that you will like the seniority out come. So it just leads to more unhappy pilots wearing AA uniforms.

I fly corporate now and don't plan to come back unless this industry really changes for the better(not happening) but to give you an idea I was hired by B6 in 4/2000 with a late April 2000 class date, which from what I have been told would give me a XX double digit seniority number. I chose the 8/2000 AA class date which as of today is a bottom feeder, strictly reserve FO on the MD80 out of LGA.

No worries like I said I have moved on but this is what comparable DOH gets the B6 pilots. Not good. So now you have to fight for fences. We get to keep our A320 ca seats and we won't get to fly your 757 and above. blah blah...... AMR mgt doesn't want this way too complicated, just ask the NWA pilots about the Green, Blue and Red BS.

My guess is that with the current stagniation and the age of the B6 pilot group (vs AA's upcoming retirements) that the current B6 FO's would rather take a chance with an AA number and no fences, this hurts the current B6 captains.

IMHO, it's just not a good marriage and I hope it doesn't happen. Just sitting back with the popcorn and watching.

 

[Flyby1206]

The JFK terminal thing just doesn't make sense to me. Why would AA want another new terminal at JFK after spending millions on one they can't even fill? Granted B6's terminal is located in the best position on the field, it's distance from AA's in a hindrance to moving pax not a help.

oneworld super-terminal

JB T5- use for Domestic narrowbody departures/arrivals for AA/AE/JB
Renovate T7(currently owned by BA), and space where old JB terminal was- use for BA, Qantas, Iberia, Cathay, JAL, LAN, and any other international carriers in the oneworld alliance
Current T8- Used for AA Int'l and Transcon type flying

Pax move from within and between terminals by a security-side train, like AA just created in MIA for their North Terminal, and currently has setup in DFW.

 

[G4G5]

oneworld super-terminal

JB T5- use for Domestic narrowbody departures/arrivals for AA/AE/JB
Renovate T7(currently owned by BA), and space where old JB terminal was- use for BA, Qantas, Iberia, Cathay, JAL, LAN, and any other international carriers in the oneworld alliance
Current T8- Used for AA Int'l and Transcon type flying

Pax move from within and between terminals by a security-side train, like AA just created in MIA for their North Terminal, and currently has setup in DFW.

Thank you, that makes sense. Do that and you own JFK, it's 50% of the real estate. In essence putting a real squeeze on any DAL expansion. UAL moves to EWR with CAL and DAL is left with spending hundreds of millions and years to expand what they have. The construction process and delays will reduce current flying tremendously.

 

[spacecadet1]

Flyby1206,
How did you get such detailed info? You are wise man.
Standby for announcement tomm.

 

[Flyby1206]

Flyby1206,
How did you get such detailed info? You are wise man.
Standby for announcement tomm.

Thanks for the compliment, but I'm no wise man. I just read lots of stuff and try to put the pieces together in a logical way. I have no inside info or connections at high levels. This is the just how I would want to do things if I ran the airline world

 

[Rez O. Lewshun]

It is all about market share... Airlines like Reno, Midway v2.0 and jetblue create a market... big AA comes in and buys them out. Jetblue did all the leg work... but one of the reasons you get a star player is so the other team doesn't have them.....

So what happens to the pilots? Representation yesterday is an understatement...

 

[Dizel8]

If AA truly wants to have a presence in NY and not just be an also ran behind Conited and Delta, they need to expand in JFK. If I ran AA, I would certainly consider acquiring jetblue.

The fleet mix could be an issue, but certainly no more so than Delta/NWA and 190 might just fit the plan rather well, now that small RJ's are going out of style.

AA has already thought about the logistics, shuttling people by bus between the blue terminal an the AA terminal, staying inside the secure area.

Will it happen, who knows, however AA found TWA desirable enough they purchased it, maybe they view jetblue presence in some of their big markets the same way!

 

[Rez O. Lewshun]

Nothing stopping AA from getting rid of the jb airbuses and putting its own fleet type on the jb routes combined with Eagle.....

Lots of options....

 

[Flyby1206]

If AA truly wants to have a presence in NY and not just be an also ran behind Conited and Delta, they need to expand in JFK. If I ran AA, I would certainly consider acquiring jetblue.

I know in the previous post I was playing devil's advocate and giving reasons AA would want to buy JB, but in reality I dont think it would be in the best interest for AA to buy JB.

If AA buys JB tomorrow you can guar-an-tee that the DOT will require AA/JB to divest a huge number of JFK slots, since they would control upwards of 60% of the JFK slots. Those slots would have to be given to another LCC like Virgin America, SWA, Airtran, etc. This is exactly what happened in DCA with the USAir/DAL slot swap. The DOT said it wouldnt be fair, and they had to give up slots to LCCs. Ultimately, US/DAL said F-it and didnt do the deal.

So, if AA DID buy JB, they would wind up giving 20-40+ slots to LCC competition, which would put them right back in the situation they are in today. Another LCC nipping at their market share. Yes, AA would also gain traction in the rest of the northeast and Caribbean markets, but those were all old AA routes they gave up anyways. I can't see them that desperate for the BOS-SJU monopoly.

Better plan for AMR would be a codeshare with jetblue, oneworld membership, then eventually turn that into anti-trust immunity which would allow the two companies to cooperate in setting schedules, prices, share revenue etc. Unfortunately, that would be the end of AA Domestic on the East Coast (which is arguably already happened when you look at current AA East coast routes).

Domestic codeshares are a touchy subject with APA, and rightly so. The company has to notify APA of any future domestic codeshare agreement and I believe APA has a 60 day period to appeal the proposal which would send the whole thing to arbitration for a decision.

If there could be a way for the pilots at both companies(AA/JB) to benefit from job increases without having to be owned by the same company there might be a chance. Maybe if jetblue votes in APA as representation and APA creates a master APA seniority list between the companies, which could allow transfers between the two? It would be like a National Seniority list, but only for APA pilots. Could be interesting if you ask me...