InclusiveScope
Well-known member
- Joined
- Mar 14, 2002
- Posts
- 385
Part 8
The Honeymoon Window
The honeymoon window of opportunity that naturally accompanied Jerry's arrival is shrinking - even with all the good things said, actions taken, and initial positive impression many feel. He has further changes in the works which should be welcome, but the circle remains broken until the deal with the pilots is consummated.
The fear is that all of Jerry's efforts to turn the tide go no where without the pilots on board. When I look at what he has said and done since January 1st, it is encouraging to see leadership emerging from the front office. But leadership without trust and mutual cooperation won't allow us to shift out of first gear.
ALPA's Initiatives - Last Year and Present
Again, to be fair, ALPA put last May's pay raise (4.5% in 2003) on the table in January of 2003. At the same time, or shortly thereafter, the Executive bonuses became public knowledge and all hell broke lose.
My guess is: at the time, better than 75% of the pilots felt the 2003 pay raise should also have been rescinded, but after the SERP issue became red hot, it would have been impossible for ALPA to get the votes needed to give back the raise last year.
The current pay raise of 4.5% is part of ALPA's proposed concessions - combined with a reduction in salary of 9% - for a total of 13.5%. From the company's side this is not nearly enough to make a meaningful difference. The 13.5% equates to less than $300 million. ALPA has other pieces on the table that equate to more concessions and efficiencies, but it still isn't enough and both sides know it.
Jerry's point is we need more immediate help if we expect to be competitive and turn the corner. To piecemeal it step by step doesn't get us there. I understand his position and why - especially if you or I were running the business - trying to pay off debt and regain profitability.
The counter argument is, "Hey, we've been trying to give them money for two years and no one will take our offers." This is what makes the pilots skeptical and suspicious about the company's true intentions. This is how talk of Chapter 11 as a "strategy" gets mileage.
It's also likely the other employees don't realize how much the pilots - via ALPA - have helped the company since 9/11 by granting waivers and side letters on issues like SILs, bow wave, monthly caps, bank provisions, and overtime flying. New agreements on the CRAF and MAC flying during/after the Iraq war also took a cooperative effort from ALPA.
Some of the reps like former Chairman Will Buergey and Lee Moak may never get the credit they deserve for work done behind the scenes to help the company between 9/11 and the time they relinquished control to the current MEC. Much of the cooperative effort that occurred since 9/11 was crafted and accomplished by these folks and others still on the MEC in the spirit of what was "the right thing to do" for both sides. We need that to continue, not stall.
Other important long-term initiatives like the code share agreement with NWA/CAL don't just happen without ALPA's concurrence. The hard work required is soon forgotten. These and similar efforts show the pilots, via their elected reps in the union, have been willing, to step up and be counted when needed - which usually benefits all of us from top to bottom.
These efforts show how both sides share a "win-win" when adjustments to the contract are made which make sense and accomplish the mission when the environment shifts in ways that can't be anticipated.
Public companies do not purposely go into bankruptcy. They have a fiduciary and legal responsibility to their shareholders. But when the company won't accept any offerings for the past couple years, you wonder if they understand the time value of money already lost.
Now Jerry is here - trying to fix it - and the bite of the apple required has grown larger. This makes him - the messenger - look like the real bad guy - when in truth, I think he is the first one who has the cojones to tell us what we need to survive and thrive again.
The board didn't listen to him two years ago. Now they have to. There are few, if any, other choices - given the nature of the beast. But ultimately, ALPA is holding their ground because these concessions should be negotiated - not dictated.
Why don't we use this opportunity as a fresh springboard to get the whole deal worked out - including concessions? Most appear ready to get it done and move on. We know we are going to hit our thumb with a hammer but we're afraid to stick our hand out and get it over with.
We know cuts are coming. Why not let the healing process begin sooner? Otherwise the pain is going to be far deeper. The longer we wait the more painful the cuts will be and the more bodies we'll see on the street - especially if we force the company to reduce the number of hubs, aircraft, and block hours - to save money.
Delta flew the highest block hour months it has ever flown in 2001 - in the months prior to 9/11. It was at that point, combined with the bubble in the U. S. economy and the stock market that Delta was starting to realize they had hired 1000 pilots too many. The reduction in the non-contract workforce had already begun and culminated with 16,000 employees getting pink slips or offers to retire early.
There are approximately 1100 pilots between the ages of 55-60. As they retire it will help bring back furloughed pilots, but it would also help if we would get our act together, get competitive, and start growing the airline instead of shrinking - particularly with the big jets.
As we all know, but no one wants to talk about - the biggest savings for any company is when you reduce the size of the workforce and do the same job more efficiently with less bodies. We can whisper and skirt the issue all day long, but this is the cold hard truth. Without growth, our furloughed pilots will be on the street even longer. And we can't grow if we don't get competitive on costs first.
One interesting side note of trivia was pointed out recently. Of the major European cities that people around the world find most attractive, Delta only serves 75% directly. That looks like opportunity knocking - in light of the fact nearly 80 million baby boomers in the U.S. are starting to retire and travel more. Berlin, Prague, Hamburg, Lisbon, Stockholm, Vienna, Budapest, Shanghai, Hong Kong, Caribbean, South America? Don't the numerals 767 and 777 roll off the tongue nicely?
The Honeymoon Window
The honeymoon window of opportunity that naturally accompanied Jerry's arrival is shrinking - even with all the good things said, actions taken, and initial positive impression many feel. He has further changes in the works which should be welcome, but the circle remains broken until the deal with the pilots is consummated.
The fear is that all of Jerry's efforts to turn the tide go no where without the pilots on board. When I look at what he has said and done since January 1st, it is encouraging to see leadership emerging from the front office. But leadership without trust and mutual cooperation won't allow us to shift out of first gear.
ALPA's Initiatives - Last Year and Present
Again, to be fair, ALPA put last May's pay raise (4.5% in 2003) on the table in January of 2003. At the same time, or shortly thereafter, the Executive bonuses became public knowledge and all hell broke lose.
My guess is: at the time, better than 75% of the pilots felt the 2003 pay raise should also have been rescinded, but after the SERP issue became red hot, it would have been impossible for ALPA to get the votes needed to give back the raise last year.
The current pay raise of 4.5% is part of ALPA's proposed concessions - combined with a reduction in salary of 9% - for a total of 13.5%. From the company's side this is not nearly enough to make a meaningful difference. The 13.5% equates to less than $300 million. ALPA has other pieces on the table that equate to more concessions and efficiencies, but it still isn't enough and both sides know it.
Jerry's point is we need more immediate help if we expect to be competitive and turn the corner. To piecemeal it step by step doesn't get us there. I understand his position and why - especially if you or I were running the business - trying to pay off debt and regain profitability.
The counter argument is, "Hey, we've been trying to give them money for two years and no one will take our offers." This is what makes the pilots skeptical and suspicious about the company's true intentions. This is how talk of Chapter 11 as a "strategy" gets mileage.
It's also likely the other employees don't realize how much the pilots - via ALPA - have helped the company since 9/11 by granting waivers and side letters on issues like SILs, bow wave, monthly caps, bank provisions, and overtime flying. New agreements on the CRAF and MAC flying during/after the Iraq war also took a cooperative effort from ALPA.
Some of the reps like former Chairman Will Buergey and Lee Moak may never get the credit they deserve for work done behind the scenes to help the company between 9/11 and the time they relinquished control to the current MEC. Much of the cooperative effort that occurred since 9/11 was crafted and accomplished by these folks and others still on the MEC in the spirit of what was "the right thing to do" for both sides. We need that to continue, not stall.
Other important long-term initiatives like the code share agreement with NWA/CAL don't just happen without ALPA's concurrence. The hard work required is soon forgotten. These and similar efforts show the pilots, via their elected reps in the union, have been willing, to step up and be counted when needed - which usually benefits all of us from top to bottom.
These efforts show how both sides share a "win-win" when adjustments to the contract are made which make sense and accomplish the mission when the environment shifts in ways that can't be anticipated.
Public companies do not purposely go into bankruptcy. They have a fiduciary and legal responsibility to their shareholders. But when the company won't accept any offerings for the past couple years, you wonder if they understand the time value of money already lost.
Now Jerry is here - trying to fix it - and the bite of the apple required has grown larger. This makes him - the messenger - look like the real bad guy - when in truth, I think he is the first one who has the cojones to tell us what we need to survive and thrive again.
The board didn't listen to him two years ago. Now they have to. There are few, if any, other choices - given the nature of the beast. But ultimately, ALPA is holding their ground because these concessions should be negotiated - not dictated.
Why don't we use this opportunity as a fresh springboard to get the whole deal worked out - including concessions? Most appear ready to get it done and move on. We know we are going to hit our thumb with a hammer but we're afraid to stick our hand out and get it over with.
We know cuts are coming. Why not let the healing process begin sooner? Otherwise the pain is going to be far deeper. The longer we wait the more painful the cuts will be and the more bodies we'll see on the street - especially if we force the company to reduce the number of hubs, aircraft, and block hours - to save money.
Delta flew the highest block hour months it has ever flown in 2001 - in the months prior to 9/11. It was at that point, combined with the bubble in the U. S. economy and the stock market that Delta was starting to realize they had hired 1000 pilots too many. The reduction in the non-contract workforce had already begun and culminated with 16,000 employees getting pink slips or offers to retire early.
There are approximately 1100 pilots between the ages of 55-60. As they retire it will help bring back furloughed pilots, but it would also help if we would get our act together, get competitive, and start growing the airline instead of shrinking - particularly with the big jets.
As we all know, but no one wants to talk about - the biggest savings for any company is when you reduce the size of the workforce and do the same job more efficiently with less bodies. We can whisper and skirt the issue all day long, but this is the cold hard truth. Without growth, our furloughed pilots will be on the street even longer. And we can't grow if we don't get competitive on costs first.
One interesting side note of trivia was pointed out recently. Of the major European cities that people around the world find most attractive, Delta only serves 75% directly. That looks like opportunity knocking - in light of the fact nearly 80 million baby boomers in the U.S. are starting to retire and travel more. Berlin, Prague, Hamburg, Lisbon, Stockholm, Vienna, Budapest, Shanghai, Hong Kong, Caribbean, South America? Don't the numerals 767 and 777 roll off the tongue nicely?
