Consessions vs furloughs

[csmith]

Re: Re: Et Al

This is so crystal clear from the outside looking in. I think we are seeing the metamorphasis of a new tactic by mangement with this same property and seniority list alter ego carrier. Albiet an alter pay ego carrier.

Of course, you're assuming that DAL recalls anyone within the next few years. If at all.

Any DAL guys hearing the rumor about another possible 600+ furloughs from on top of the 1400? FWIW, I was told this by a DAL pilot yesterday JS'g.

It is hardly a "new" tactic to play the senior group within a list against the junior group. It has been going on for years.

Again, FM cannot last forever.

On that note, chief pilot messages to the group have said that the number will remain at 1400 barring another force majeure event. Invading Iraq has some speculating that this would constitute a "war emergency" and would thus fall under the FM definition. I would imagine that such a furlough would again be grieved, but it too would end. The trick for the Delta pilots is to remember what happened back during the previous Iraqi scuffle. The concessions came in when the economy was just picking up momentum. When asking for some givebacks while record profits were being made, a good faith gesture that management and labor were really in it together, the infamous words "a contract is a contract" were uttered. Most guys I have spoken with have not forgotten these words, and will not.

In case everyone missed it, FM cannot last forever. It will end, and I want TK to come back to the job he left.

 

[tbkane]

csmith

I want tk back also, more than anyone can imagine.

 

[csmith]

Re: Et Al

8N remarks in quotes:

You are assuming that we are all equal at the outset. Unless Congress decides to re-regulate the airline industry, (it was mentioned in hearings the other day) our employers operate in a free market. At the present, the market is not supporting "full service" major carriers. Whether you and I like it, or not, costs will come down to a sustainable level. I differ with you in that I am not attempting to maintain a level above market, I am trying to bring a below market package up to market.

I too have heard the rregulation word thrown around. At this point, I am tending to agree. I have yet to see quantifiable data, as none of us are economists, that this market will not support full service carriers. This industry is cyclical, and everyone predicts the doom of the high paying jobs with every downturn, yet somehow they make it through. Saying that compensation cuts at the full service carriers will not effect the bargaining of the low fare carriers is totally incorrect. I remember at good old 8N, everybody bought off on that idea back in 92. AMR was furloughing so Eagle had to furlough as well, and cuts were needed as well. Blah, blah, blah. None of it being true of course, but I would not be surprised to see the strikebreaker press-to-test button pushed in this tight job market if the low fare carrier pilots do not fall in line with managed expectations during negotiations.

Do you realize that this position makes my case? Certain DAL furloughees, have stated that they are happy to be on furlough because it means that they will have high wages once they are recalled. Now you are positing that the DAL pilots will work for "B" scale. I submit that this proves me right.

It does not prove you right. I did not post that Delta pilots would work for a b-scale as witnessed by the very next line in your post--note the is should be an if. That is a big IF. All of this is conjecture anyway, as those rumors are just that--rumors.

I submit that this will generate pay cuts at other airlines, maybe even yours, is the Delta pilots sign off on it.

All I have to say, is that you are not getting my point. This is not the 70's. The market doesn't resemble those markets in any way. I assume that your figure of 320K per year pay cut is a typo.

I am quite aware that this is not the 70s, however, maybe you should tell that to the car prices, or the cost of a movie, or groceries, or gas. All things are relative. A pilot for Delta is not have the standard of living he or she did back in the 70s and 80s. Suggesting further pay cuts on top of my 20K, yes it was a typo-sorry, is absurd. Yes, I am aware that many guys took a 100% pay cut. It is unfortunate, it is not unusual in this industry, and having been furloughed myself I feel their pain and anxiety. That being said, I don't see management cutting other employees compensation. You certainly don't see management cutting their own compensation. In fact, as we are all aware, VPs at Delta are the most rapidly growing segment of our population. Management in airlines always has a history of running to labor for concessions when their tired out ideas are not working at the moment, yet they do not share in the lucrative times. Labor cost ain't the problem. The Delta MEC knows this. This is why their services are in demand at other airlines.

Sorry to disappoint. I don't agree with your point, but this is an discussion among gentlemen. We can agree to disagree. I hope that I didn't come across as having any personal animosity. I am on your side. I would much rather work for your scale than mine.

No offense taken. I do think you do have some personal animousity, but I'll take your word for it that you don't. I have absolutely no doubt that my services and responsibilities command the pay which is paid to me. I agree that your services should command no less. The problem is, and has always been, that we--pilots--are whores. I am not exempt from this, nor are you. As low as you think you are paid, there are people lining up out there who are willing to step into your seat for less money. This the problem which will plague us forever, keep two tiered payscales, affect the age 60 rule, and so on. I guess we will agree to disagree, but I'm still listening.

 

[Boeingman]

Re: Re: Re: Et Al

It is hardly a "new" tactic to play the senior group within a list against the junior group. It has been going on for years.

Yes, I am aware of that. My point is that this new carrier within a carrier will bring the old tactics to a new, unprecedented level.

 

[DaveGriffin]

Re: Re: Re: Et Al

It is hardly a "new" tactic to play the senior group within a list against the junior group. It has been going on for years.

It would be an absolutely useless tactic if the seniors didn’t jump on the opportunity to protect their self-interest at the expense of the juniors every chance they get. You can’t blame anyone but yourself for this.

Again, FM cannot last forever. In case everyone missed it, FM cannot last forever. It will end…

It certainly will, but not as a result of the second grievance hearing in late October. From the comments on this board by the furloughees, it is evident you have gotten their hopes up with the second hearing. Your leadership knows full well it will fail. As was the first hearing, it is nothing more than a meaningless gesture intended to convince the juniors how hard their union is working on their behalf.

 

[Publishers]

Selling

Of course to some around here, closing the door, selling the assets, hanging the name up, and turning out the lights is only another managment tactic.

What you are missing in here is that there is nothing in the entire industry like the old one. It is like saying that the fractionals have not had an impact on business aviation and that the business aviation business will bounce back like it was before. There has been a new entry in the market that has a tremendous effect.

There was not a Southwest, at least like it is today, to turn to. There was not an Air Tran, Frontier, or jetBlue. The customer was forced to go back to the full service carrier because that was what was there in many markets.

This myopia of things will go back is like saying that cell phones are just a fad/ Not going to happen

 

[csmith]

Re: Selling

Of course to some around here, closing the door, selling the assets, hanging the name up, and turning out the lights is only another managment tactic.

What you are missing in here is that there is nothing in the entire industry like the old one. It is like saying that the fractionals have not had an impact on business aviation and that the business aviation business will bounce back like it was before. There has been a new entry in the market that has a tremendous effect.

There was not a Southwest, at least like it is today, to turn to. There was not an Air Tran, Frontier, or jetBlue. The customer was forced to go back to the full service carrier because that was what was there in many markets.

This myopia of things will go back is like saying that cell phones are just a fad/ Not going to happen

Before the doors are closed and the lights turned out, for Delta anyway, other carriers will be long gone. IOW Delta will be one of the last to fail. America needs its transportation system. I would venture to say that the govt will step in with an emergency plan. SWA, AirTran and JBlu can't fly all of the passengers. Shutting down the world's busiest airport? I think not. Delta ain't going out of business because of labor. Delta is hurting because of a flawed business model which exploits air travel at pennies on the dollar for what air travel used to bring. The airlines have always been victims of lack of pricing power. RJs aren't going to save them. Age 60 isn't going to save them. Guns in the cockpit isn't going to save them. Furloughs aren't going to save them. Fundamental changes in the business model will buy them time until times are good again, or people realize that they have gotten exactly what they have paid for.

C

"You going to kill this deal over labor?!?" --L.M.

 

[Boeingman]

underfunded pensions...the next time bomb

I wonder how this will play into the financial picture and where management will trim next.


http://www.aviationnow.com/content/publication/awst/20020610/avi_air.htm

 

[enigma]

Re: Re: Et Al

[B}No offense taken. I do think you do have some personal animousity, but I'll take your word for it that you don't. [/B]

If I had personal animosity, you would know it. Disdain for what I think is a myopic viewpoint, but no animosity. I just like a good discussion.Unlike some participants in these threads, I can't challenge others to search my posts in order to prove that I am clean. I haven't fallen to the level of flame, but I can get mad at times, especially late at night.

This isn't one of them.

Call me a professional devils advocate, if you will. I am usually responding to inconsistencies in arguments made by others.

Example. You said, "That being said, I don't see management cutting other employees compensation. You certainly don't see management cutting their own compensation. In fact, as we are all aware, VPs at Delta are the most rapidly growing segment of our population. Management in airlines always has a history of running to labor for concessions when their tired out ideas are not working at the moment, yet they do not share in the lucrative times"

Then you said, "Before the doors are closed and the lights turned out, for Delta anyway, other carriers will be long gone. IOW Delta will be one of the last to fail."

Which is it. Is DAL the best managed carrier, able to be the last man standing; or a carrier that is run with "tired ideas"?

You noted that there were pilots in line for my job even though I think it is low paying. I agree. It is precisely this fact that makes me say that ya'll are not going to return to business as usual. And unlike times past, there are viable companys in line for your companies business. That's the difference. I saw a news tidbit in a business magazine today. It stated that the market value of JetBlue with its 3100 employees, was more than the combined value of UAL, AAA, and NWA (I might be wrong about NWA, it could have been on of the other old majors), who have a combined employee list of 175000. In the past, your employers upstart competitors consisted of dreamers like PeopleExpress. They had ideas but no money. Now the challlengers have a tremendous amount of backing and they are not just going to go away when DAL decides to compete. As we speak, your fares closely match those of AAI. DAL is losing money, AAI is making money.(generally speaking) Maybe the stockmarket will continue to support a losing company, Lord knows TWA stayed in business for years, but times change.

If you're waiting for the government to bail out the majors, I can only say this: If you take their money, you play by their rules.

I have no doubt that management could do a better job of running your company, I agree about the number of VP's, I went round and round with the Publisher about blaming pilots for UAL's ills, but none of that really matters. What matters is that your company is just about to start a "B" scale. I hope it doesn't happen, for both our sake.


regards,
8N

BTW, 8N refers to a 1950's era Ford farm tractor. I'm not sure what you mean about good old 8N in 89.

BTW #2. My mind is open, it can be changed. My views on numerous subjects have been modified by the intelligent arguments made on this very forum. If you're correct in all this, you'll win me over.

 

[csmith]

Re: Re: Re: Et Al

Call me a professional devils advocate, if you will. I am usually responding to inconsistencies in arguments made by others.

Example. You said, "That being said, I don't see management cutting other employees compensation. You certainly don't see management cutting their own compensation. In fact, as we are all aware, VPs at Delta are the most rapidly growing segment of our population. Management in airlines always has a history of running to labor for concessions when their tired out ideas are not working at the moment, yet they do not share in the lucrative times"

Then you said, "Before the doors are closed and the lights turned out, for Delta anyway, other carriers will be long gone. IOW Delta will be one of the last to fail."

Which is it. Is DAL the best managed carrier, able to be the last man standing; or a carrier that is run with "tired ideas"?

I don't think the quotes you used are inconsistent. What I am saying is that with all of this "turmoil", Delta hasn't come to the pilots for concessions. Delta hasn't yet cut the pay of the line workers--none of which are unionized. Delta hasn't downsized the upper levels of management. USAir did the same thing--they always come to the pilots first. I don't see our group willing to fall into the trap again. I will say it again--we will not go under because of labor. In the 90's, the Delta pilots could have worked for free, and Delta still would have lost money. I would say we are nearing that point now in the 2000s. Are my services worth any less now because Delta is losing money? The free market may say yes, I say no. My contract says no, and my opinion now says let a judge say otherwise--but I am still listening. If I am wrong, and Delta goes under, it will be one of the last--if not the last--to do so. I think the govt will step in before they let USAirways, UAL, AMR, and Delta go under. I guess I don't see where this is an inconsistency. Delta is being managed the best of the hub and spokes with their current business models, yet that doesn't make the model exempt from flaws--even fatal ones.

IMO, things are bad. To top it off, management is screaming poverty now and since 911 to get money/breaks from the govt. .25 out of every dollar spent on a ticket goes to taxes, landing fees, or some other form of user fee. Justifiably, they are trying to get the govt to foot some of the bills. Why not try and stick it to labor while we can as well?!?

I noticed that you refered to JBlu stock. Overvalued, overvalued, overvalued. Was in the 40s, now the 30s. SWA has been trimmed as well, although still a great market cap. I am no stock expert, so I have to go on what people say--people who know what stocks are really about that is.

There are a lot of things which Delta could be doing right now t plair fair with the pilots, and they are not doing them. They are seeking ways around the contract they agreed to rather than come to us so that we could seek solutions. I can only assume that they know what they are doing. If they don't, any amount of concessions we give won't help anyway.

C

 

[V-1]

Re: Re: Consessions vs furloughs

I would submit that Delta pilots are STILL behind real dollars from their 70's and 80's compensation even after "pricing themselves out of the market".

While this is probably true, I think nearly every person has seen "real dollars" decline since the 70's. How many families today have to have both adults working so they may enjoy the same lifestyle their parents enjoyed in the 1950's, 60's, and 70's, even though only one of their parents worked?

While this is unfortunate, it is reality for millions of American families.

 

[enigma]

Re: Re: Re: Re: Et Al

What I am saying is that with all of this "turmoil", Delta hasn't come to the pilots for concessions. C

Yes they have. What do you think furloughs are? I think furloughs equal a reduction in total wages equal concessions. The only difference between furloughs and concessions is in who takes a cut. With a furlough, the junior pilots take the entire concession. Everyone could a percentage of the consession, as did AAI. I don't really think the company cares as long as they cut the bottom line. The point of my starting this thread, however poorly stated at the outset, was to counter the notion that DAL was only keeping the number of pilots that they needed, no matter what the wages. I believe that line of reasoning shows denial on the part of those who espouse it. It is obvious to me that DAL needs pilots in mainline equipment, just not at the current wage scale.

I agree with you that if DAL goes under, it will not be because of pilot wages. However, it is obvious that the company would be better off at the present with lower labor costs. The companies that you compete with have those lower costs, and unfortunately wages are set by what someone else is willing to work for, not by what income you generate.

Somewhat off subject, but: I think that the largest problem for you and I as employees with a contract, is that wages are so inflexible. I would personally rather have a "base plus" system that would allow us to rake it in during good times and still survive during tough times; than I would have the current system in which we racthet the wages during good times only to have to accept furloughs when slowdowns happen.

regards,
8N

 

[Publishers]

Enigma

Sometimes Enigma brings a level of intelligent thought that this board does not deserve.

I remember sitting in a research think kind of deal several years ago that discussed whether Delta would be a viable internatonal carrier or have to merge.

 

[csmith]

Re: Re: Re: Re: Re: Et Al

Yes they have. What do you think furloughs are? I think furloughs equal a reduction in total wages equal concessions. The only difference between furloughs and concessions is in who takes a cut. With a furlough, the junior pilots take the entire concession. Everyone could a percentage of the consession, as did AAI. I don't really think the company cares as long as they cut the bottom line. The point of my starting this thread, however poorly stated at the outset, was to counter the notion that DAL was only keeping the number of pilots that they needed, no matter what the wages. I believe that line of reasoning shows denial on the part of those who espouse it. It is obvious to me that DAL needs pilots in mainline equipment, just not at the current wage scale.

Look, you are either overmanned or you're not. Delta wants to cut capacity. If they cut capacity, they do not need as many pilots. Delta cannot furlough pilots based on economic conditions. Delta found the "hole" with the 911 attacks. All of the concessions in the world will not change the fact that Delta management is making this airline shrink to the point where we are overmanned. If everybody takes a paycut, we are STILL overmanned. This makes the operation inefficient despite the fact that overall labor costs are reduced. History has shown time and time again that Delta is willing to pay pilots a percentage of double time rather than keep extra pilots on the payroll. You reasoning is incorrect. Delta has not come to the pilots for concessions to mitigate furloughs. Air Tran knew they were getting aircraft. They knew the pilots would be coming back. Their operation is small. Large difference. Your assertion that the Delta pilots are not doing everything in their power to help the furloughees is not correct. Changes are in the works, and you are apparently not in the know just how far the Delta pilots have gone to help their own. How exactly is it "obvious to you that Delta needs pilots in mainline equipment, just not at the current wage scale"?

I agree with you that if DAL goes under, it will not be because of pilot wages. However, it is obvious that the company would be better off at the present with lower labor costs. The companies that you compete with have those lower costs, and unfortunately wages are set by what someone else is willing to work for, not by what income you generate.

I have news for you, the company will ALWAYS be better off at the present with lower labor costs. If this paragraph is true, then how do you think that the Delta pilots were able to achieve the pay rate they did? Obviously most on this board just love aviation so much that they would fly a 777 for $60 an hour?!? Of course, if you stick a 1500 hour pilot in a 777, you are going to run into some trouble. Another question: If wages are not set by the income you generate, then why does a 777 captain at Delta make more than an MD88 captain? or at United or at American. You are a closet managementist. You want to decouple productivity from wages. You make management's argument for them that Delta pilots are overpaid. You are, of course, entitled to that opinion, but IMO you have very little idea of what you are talking about. The question remains, Delta has not and will not come to the pilots and say, "if you take XX pay cut we will not furlough XX pilots." Why?

Somewhat off subject, but: I think that the largest problem for you and I as employees with a contract, is that wages are so inflexible. I would personally rather have a "base plus" system that would allow us to rake it in during good times and still survive during tough times; than I would have the current system in which we racthet the wages during good times only to have to accept furloughs when slowdowns happen.

In short, I wouldn't. I also can't believe what I am reading. We are not management, we are laborers. As soon as you realize that, you will be better off. Our pay should not be tied to company performance. IT AFFECTS SAFETY. Our job is about SAFETY--PERIOD. We need to get airplanes from A to B--SAFELY. Maybe pilot X will take a jet which is not airworthy because the company will not make money if the flight cancels. If the company does not make money, his pay is affected. I just can't even believe you said this. This company does exist right now, and it has these very problems. I have friends who have seen them to prove my point. This thread has become totally out of control. Delta pilots are perfectly capable to decide what is good for the Delta pilots. The MEC has been spot on thus far. I will tell you that nothing will come about until the hearing at the end of the month. After that, you could likely see some changes. That is about all I have to say on this thread. Unbelievable.

 

[csmith]

Re: Enigma

Sometimes Enigma brings a level of intelligent thought that this board does not deserve.

I remember sitting in a research think kind of deal several years ago that discussed whether Delta would be a viable internatonal carrier or have to merge.

While I disagree with you in this thought, I think he brings some very skewed thought--to this thread at least, I agree that we are heading for consolidation. I think that is where we have been headed for some time. I think the aviation market will be able to house 5-7 carriers and their subsidiaries. IMO, the ATA is working on this behind the scenes. Merger mania is not over with the United/USAir fiasco. It will resurface, as will others. This will allow them to control capacity, and bring fares to a reasonable level. Again, my opinion only.