ASA Contract Thoughts

[JustaNumber]

I agree with the drunk Irishman that Skywest Inc will do what they are going to do fleetwise regardless of what happens with our contract. In fact, I would make the case that the reason Skywest Airlines is getting new growth versus ASA is not that ASA is too expensive; rather, it is because Skywest Airlines is too expensive.

The latest financial results are clear: ASA is the nation's most profitable regional, with Skywest Airlines in second. If you were Skywest Inc, you probably would let ASA coast for a while while you worked hard to increase Skywest Airlines' profitability, just to balance out your portfolio. The best way to increase profitability is through growth, so, bingo, Skywest Airlines gets the new growth airplanes. This simultaneously strikes fear into the hearts of ASA pilots, hopefully resulting in a cheaper pilot contract, and placates the Skywest pilots, keeping ALPA off property allowing for future flexibility.

So ironically, ASA is not getting growth because our costs aren't high enough!

Now, that's not to say that we couldn't price ourselves out of future growth if we're not careful, but I really doubt the most profitable regional airline in the country would be allowed to be completely dismantled or shut down, just because Jerry doesn't like us. So stand united and firm in your/our desire for a fair contract, just make sure solid scope is a part of it.

 

[Ganja60Heavy]

Have you considered yourselves as the problem??????

You should listen to you wife...she's right....you ARE an a$$hole!

 

[~~~^~~~]

I can't seem to get a stright answer from any pilot at ASA but it seems to me now that some of the old SLC based ASA Pilots would like to vote out the Union (or maybe they are just BSing me), work with the SkyWest pilots to merge the two groups into one and work with 3 pay scales or OO to bid in ALPA....Is this logical or practical to both pilot groups?

Decertifying a union is not real easy, although it can be done. With ASA in this stage of negotiations, decertification would be down right foolish. Remember, the pilots do have to live with whatever the result of our contract is and with the power the Company has over us in the airline business you really have to slow down and think about the possible outcomes of radical action. ALPA is good at contract negotiations, believe it or not. ALPA's problem is that they so screwed up scope that that the ASA pilots are in a battle with no one able to stop the transfer of men and material to the other side. Time really is working against the ASA pilots.

I think a large majority of ASA pilots would like to merge, but that a merger is unlikely. First, ALPA does not want to even try until the SkyWest pilots vote on representation (which appears to be an "if SkyWest pilots vote" at this point). A merger would force a vote and ALPA is unsure of the outcome - so they are not going to there. Second, as the Delta / United scope conflict illustrates - there is a need for another certificate to get around mainline scope restrictions. Third, I believe Delta has a right to repurchase ASA and Fourth, Jerry Atkin says he is not opposed to a merger, but would want the lowest cost option from each working agreement - not the highest.

If ASA gets beat down to a slightly below average contract - then a merger is more likely. Jerry Atkin could do the merger, force the representation vote and have low costs and be rid of ALPA. SkyWest Airlines and ASA could still be operated separately with a single list and fences. But is just as likely that as soon as ASA's deal is done, Jerry will be back to the SkyWest pilots looking for concessions and the 1,400 First Officers there will be willing to deal to hold on their dream of a year and a half RJ upgrade.

Separated, we are going to get beat up badly. The only option with any hope for a better tommorrow is to come together and remove pilot wages from Jerry's decisions on airplane allocation. ALPA facillitates working together.

 

[John Pennekamp]

Separated, we are going to get beat up badly. The only option with any hope for a better tommorrow is to come together and remove pilot wages from Jerry's decisions on airplane allocation. ALPA facillitates working together.

The United MEC has a saying: "Bargain together, or beg alone".

That couldn't be truer in regards to the ASA and SKW pilots.

 

[CFIT]

The latest financial results are clear: ASA is the nation's most profitable regional, with Skywest Airlines in second. If you were Skywest Inc, you probably would let ASA coast for a while while you worked hard to increase Skywest Airlines' profitability, just to balance out your portfolio. The best way to increase profitability is through growth, so, bingo, Skywest Airlines gets the new growth airplanes.

I'm curious of where you got your data about profitability, because from SkyWest Inc. SEC filings it shows an approximate profit margin of 5.1% and from the profit sharing check I just got it worked out that SkyWest Airlines had a profit margin of 5.35%. From what I can see that would indicate that SkyWest Airlines was slighty more profitable than ASA, or am I looking at this incorrectly?

 

[outtahere]

ASA has maintained a 13% profit margin, most profitable by margin, but Skywest made a little more cash due to their size.

 

[FightingIrish]

ASA has maintained a 13% profit margin, most profitable by margin, but Skywest made a little more cash due to their size.

ASA's profit margin is nowhere near 13%. It is around 5%.

 

[Stifler's Mom]

If you look at our completion and on time performance at SLC,CVG, and outstations it is always well above our goals. However ATL is always pulling the numbers down. Its the same crews on all those flights so it is clearly not the pilots.

70-seat crews fly in SLC.
50-seat crews fly in CVG.
ATR cews only fly in ATL.

Bobby Bipolar is partially correct. It's just the ATR folks that are the problem.

 

[asapilot]

ASA's profit margin is nowhere near 13%. It is around 5%.

Someone's been listening to too many Scott Hall speeches. 13% comes from the DOT, 5% come from Scott Hall's fuzzy math. You'd have us take his 'word' for it instead? Regardless of it being 13% or 5%, the company has no basis for asking us to agree to anything concessionary, money or QOL-wise. When I see some professionalism from ASA management, I'll start taking what they tell me at face value. They proven time and time again to not be credible, nothing's changed so far...

 

[Speedtape]

Maybe, maybe not.

SkyWest's pattern has been to threaten our MEC with proposals - two that come to mind are:

• (1) Accept the concessionary proposal (the one with deep cuts to the -700 guys) or you will lose SLC.
• We said, "we don't buy airplanes and will not accept that contract - take them"
• Three months later, SkyWest made good on their threat.

• (2) Then SkyWest said accept this proposal or you will lose the first 6 900's.
• We responded that we did not have the opportunity to consider preferential bidding, that the company would not make a counter proposal to our movement and we still did not like the offer. We also were a little smug that SkyWest did not have the 900 approved on their Certificate, did not have the over water exemption and that costs would be higher to move this airplane to SkyWest to fly out of Atlanta.
• Two, or three, months later, SkyWest gets the 900 in operation (copying our paperwork with FAA approval) and they announce to shareholders that allocating the 900's to SkyWest is costing more money than what was anticipated. However, none of the investors asked the follow up question, "why would you want to do something that increases expenses?"

Nothing is fixed, nothing is certain. Jerry Atkin has the power and the inclination to move airplanes even if it increases SkyWest's costs. He is making enough money to spend a few dollars beating up ALPA. Besides he just saved a bunch of money on his airplane insurance by calling GEICO. (kidding about GEICO, not kidding about his saving some money by trying something unique)

The ASA pilots will probably end up at the same point regardless who is our Status Reps. The pilots need a job more than SkyWest needs a bunch of guys with 7 plus years of longevity. I also trust that regardless who our Reps are, that they will listen to the pilots and represent them - using the Wilson data and feedback from the line guys.

Jerry Atkin already said ASA could score a tremendous contract, but he would simply transfer all the airplanes away. Our MEC knows that we have no scope to protect us. In our union communications we constantly hear they are working towards a contract that serves the ASA's pilots needs while allowing ASA to remain competitive. That tells me they know there is a trade off between jobs and our contract and they are trying to find the best balance.

Pilot hiring should pick up in 2007 and possibly that will give the ASA MEC a little more power. I hope so. Negotiating a contract without scope while an alter ego airline eats away at your job base is very difficult.

Excellent post and right on target!