Consessions vs furloughs

[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.

 

[enigma]

csmith

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.
........................................................................................

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"?

..........................................................................................................
You are a closet managementist. You want to decouple productivity from wages. .
....................................................................
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?


.........................................................................

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.
.........................................................................................

This thread has become totally out of control.
................................................................................
Unbelievable.

Point one. IF DAL wants too cut capacity, then why are they talking about starting
another narrowbody carrier?

Two. See point one. What part of the connection between increasing capacity on a "B"
scale subsidiary and decreasing capacity on old mainline DAL am I missing? It seems to me that the only difference between the new subsidiary and DAL mainline will be labor rates. Rates that will have to be lower across the board. The new subsidiary will not pay lower landing fees, nor lower parts costs, nor lower fuel costs, nor lower Pepsi costs, nor lower insurance costs, etc. So why bother to start a new subsidiary?

Three. I am not a closet managementist. I am a free market advocate who tries to utilize the knowledge I was forced to learn in order to gain the degree that would enable me to show that I was DAL material. I tend to follow Ludwig von Mises and Walter Williams in economic thought. I am commenting upon what appears to be economic reality. Whether or not you agree won't change the facts, and they are that your carrier is changing to
accomodate market forces. I am not arguing for any sort of change, just commenting on the changes that are occuring.

Four, they haven't come and asked for a paycut vs furlough because they can do it without you. They appear to be doing it without you. That's what this whole string is about. I suspect that management would rather have a seperate group because it makes it easier to whipsaw you. Remember, I am not advocating a certain course of action, just observing the possible.

Five, In short your pay is tied to company performance. Just how much pay are the Braniff/PanAm/Eastern/etc, pilots drawing at the present?
As soon as you realize that DAL doesn't exist in a vacuum, you will be better off.

Six, Why would you say that the thread is out of control? I see a group of reasonable adults debating a topic. In such a forum, you are expected to defend your positions. Nothing more, nothing less. If you don't want to enter in, you don't have to.
Matter of absolute fact. If you want a thread to die, then don't respond. This bbs has so much activity that a boring, worthless, uninteresting thread won't stay on the front page for more than twelve hours. After that no one thinks it's worth reading.

Last, what's unbelievable to me is the way you would characterize a thread in which you are a significant contributor as "out of control". I thought we were debating an issue. I
offered, you responded. Did you think that we would just silently bow out once you had shown us where we were wrong? I will bow out loudly, when I have been convinced that I am wrong. As I have before. Give me enough information and you have a good chance of convincing me. Part of the reason I post is to increase my knowledge and understanding.
As steel sharpens steel, as I believe the saying goes.

regards
8N

 

[csmith]

Re: csmith

Point one. IF DAL wants too cut capacity, then why are they talking about starting

Two. See point one. What part of the connection between increasing capacity on a "B" It seems to me that the only difference between the new subsidiary and DAL mainline will be labor rates. Rates that will have to be lower across the board. The new subsidiary will not pay lower landing fees, nor lower parts costs, nor lower fuel costs, nor lower Pepsi costs, nor lower insurance costs, etc. So why bother to start a new subsidiary?

Four, they haven't come and asked for a paycut vs furlough because they can do it without you. They appear to be doing it without you. That's what this whole string is about. I suspect that management would rather have a seperate group because it makes it easier to whipsaw you. Remember, I am not advocating a certain course of action, just observing the possible.

Five, In short your pay is tied to company performance. Just how much pay are the Braniff/PanAm/Eastern/etc, pilots drawing at the present?

What does it accomplish to quote me and offer little or no anecdotal evidence to prove your point?

I have explained what one of the premier reasons for starting a new subsidiary-to detach the Delta name from "low cost". Your assertion that "they can do it without you" is incorrect. On any carrier with a/c over 70 seats, they have to use Delta pilots. Once again, they have to use Delta pilots. WWW.DALPA.COM you can view a copy of the contract. They will need the Delta pilots' blessing to pull this one off. The savings could very well come in the form of outsourced mtx, gate, ramp, and FAs. The chief pilot's office insists that flight crews would not be outsourced. Lower parts costs, leases, training, etc could very well be part of a deal with any a/c producer, so that statement is also incorrect. With all of the aircraft parked in the desert, do you honestly think we could not get a good deal from, say, Airbus regarding the aforementioned?!?

Additionally, comparing current Delta to the Braniffs, Easterns, PanAms is a bit, uh, extreme--don't you think? I will reiterate my point. The logic behind tying pilot pay to performance is a safety issue and completely inappropriate. The "out of control" statement referred directly to this line of reasoning. You can do it at your carrier if you want to push that, but kindly leave my carrier out of it. I mention safety and pilot pay being linked with company performance as being mutually exclusive, and you pull Eastern, Braniff, and PanAm out of the bag. WTFO? That is just more insanity. Sorry, but I can't think of a more PC way of putting it. It is a conflict of interest to link the two.

Finally, I contribute to threads primarily to correct misinformation which others put out. In this particular instance, you have implied that Delta pilots have not done enough to mitigate furloughs. Others, anti-Delta pilot types, have jumped on your bandwagon. You don't need more information to see that some of your arguments are just plain headed the wrong direction. If you don't have the information to make the argument, then the responisble thing to do is not open the can of worms in the first place. If you open that can, and are wrong, you are bound to be corrected.

Edited to make the link work.

 

[michael707767]

Re: Re: Re: Re: Et Al

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. C

As a Delta pilot, I agree with you, my services are not worth less now that Delta is loosing money. However, I accept the reality that what I feel I am worth, and what the company is capable of paying, are two totally seperate things. Like it or not, the ability of the company to pay is more important than what we think we are worth. Will labor costs be the only thing that make or break an airline? No. But we need to get over the idea that what we make has zero impact on the bottom line.

 

[Publishers]

Leo

If I were Leo, I would make this a subsiderary of Comair or one o fthe other carriers. Might spin off Comair and replace with the new entitiy.

What does your contract say about that

 

[enigma]

Re: Re: csmith

What does it accomplish to quote me and offer little or no anecdotal evidence to prove your point?

WTFO? That is just more insanity.

Finally, I contribute to threads primarily to correct misinformation which others put out. In this particular instance, you have implied that Delta pilots have not done enough to mitigate furloughs. Others, anti-Delta pilot types, have jumped on your bandwagon. You don't need more information to see that some of your arguments are just plain headed the wrong direction. If you don't have the information to make the argument, then the responisble thing to do is not open the can of worms in the first place. If you open that can, and are wrong, you are bound to be corrected.

Edited to make the link work.

ALL of the evidence I have offered is anecdotal. I don't believe you know the definition of anecdotal. Had I had anything but anecdotal evidence (ie, factual evidence), I would have put you away long ago.

If your statement about arguments heading in the wrong direction made any sense, I could better respond.

So, now I'm insane. Another word that you lack proper understanding of. So much for having a reasoned debate.

I will open any can of worms I choose. Your choice is to use this open forum to prove me wrong. I don't have the least desire to make you look bad, prove you wrong, correct you, etc. I have no problem with being corrected. But you have yet to correct me. Called me crazy, yes. Corrected me no.

I continue sparring with you, because of the hundreds of others that read this board. I have no desire to change your mind, nor fight with you. I will let the others judge if I have made cogent arguments.

Peace.
8N

To the "others" the last sentence is not intended to encourage you to post either support or opposition. Please refrain from keeping this alive. Anyone who wants to continue a reasoned debate, Let me have it.

 

[enigma]

Re: Leo

If I were Leo, I would make this a subsiderary of Comair or one o fthe other carriers. Might spin off Comair and replace with the new entitiy.

What does your contract say about that

Just to prove that I'm not management material, I hadn't even thought of that. Such a move would start a whipsaw of monumental proportions.

This could force the RJDC to go with my idea and change their name. Maybe the 737"B"scaleDC, would be appropriate.

regards,
8N

 

[csmith]

Re: Re: Re: csmith

ALL of the evidence I have offered is anecdotal. I don't believe you know the definition of anecdotal. Had I had anything but anecdotal evidence (ie, factual evidence), I would have put you away long ago.

If your statement about arguments heading in the wrong direction made any sense, I could better respond.

So, now I'm insane. Another word that you lack proper understanding of. So much for having a reasoned debate.

I will open any can of worms I choose. Your choice is to use this open forum to prove me wrong. I don't have the least desire to make you look bad, prove you wrong, correct you, etc. I have no problem with being corrected. But you have yet to correct me. Called me crazy, yes. Corrected me no.

I continue sparring with you, because of the hundreds of others that read this board. I have no desire to change your mind, nor fight with you. I will let the others judge if I have made cogent arguments.

Peace.
8N

To the "others" the last sentence is not intended to encourage you to post either support or opposition. Please refrain from keeping this alive. Anyone who wants to continue a reasoned debate, Let me have it.

I guess we are done since you fail to address the meat of the issue an only choose to assert your rights--sure sign of no aurgment. I don't know how to make my posts more clear, I cited examples, I explained in detail. I don't know what part of a "reasoned debate" you really expect I guess, perhaps the incorrect choice of a word while I am typing at a mile a minute. Good one. Center in on the typing skills, kinda like the guys who make an argument of misspelling. Do you have any rebuttals to my explanations or not?

 

[csmith]

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

As a Delta pilot, I agree with you, my services are not worth less now that Delta is loosing money. However, I accept the reality that what I feel I am worth, and what the company is capable of paying, are two totally seperate things. Like it or not, the ability of the company to pay is more important than what we think we are worth. Will labor costs be the only thing that make or break an airline? No. But we need to get over the idea that what we make has zero impact on the bottom line.

We may very well be headed that direction, Michael. Don't get me wrong, if the company needs help I'll be the first one in line. We will never know if the company needs help or not. They will never let us see the true numbers. Last time, the Delta pilots were sold a bill of goods, and the company turned around in record fashion. When the company is losing money, they want concessions. When times are good, and we want it back, they tell us to go pound sand. As the son of an accountant, i can tell you that there are many ways to legally cook books. The company has an agenda right now. They want government help, again, and IMO they want consolidation. To get both, the books have to look as bad as possible. Of course this is the perfect chance to take a shot at labor as well.

If I may, in physical terms, what do you mean with the statement,"we need to get over the idea that what we make has zero impact on the bottom line."

 

[csmith]

Re: Leo

If I were Leo, I would make this a subsiderary of Comair or one o fthe other carriers. Might spin off Comair and replace with the new entitiy.

What does your contract say about that

Depends on how big the airplane is on the subsidiary.

 

[Publishers]

carrier

Frankly, I do not think that your contract even deals with Comair creating an new company as a partner.