LJDRVR said:
Nobody knows what will happen yet. We are in talks with more than one entity concerning the airplanes. CAL has been disappointed with the RFP responses, they've received. My understanding is they weren't much less than our final offer to CAL. Add to that the complications of new feed, coupled with the fact that none of you folks even approaches our reliability, sophistication, completion factor, any metric you care to measure. Don't take that personally, with very minor exceptions, you guys are talented, hard-working aviators that work for good companies. But please understand that XJT is a major airline that just happens to fly 50-seaters. (And one of the better majors at that.)
My opinion? CAL is regretting their decision, and when we pull the trigger on whatever new form of business WILL take place later this year, ALL of us are going to be standing there with a look of amazement on our collective faces. Don't count XJT out yet. You guys and girls are not going to believe what happens next. You may even see us give the airplanes back to CAL so as not to upset them, then turn around and purchase new airframes.
I'll make two predictions:
Not a single pilot furloughed
No Concessions
Wow LJDRVR - that was a pretty impressive list of accomplishments you tried to rattle off in defence of XJT. Keep on being delusional, son. Take it from me, an ACA/FLYI alum who was there for over five years, witnessed first hand our struggles with UAL in the late 2002 - early 2003 timeframe and went down with the ship; as XJT you guys are a good company with a good product but that won't count for squat with CAL. Be ready for some pretty uncomfortable changes that are darn near inevitable.
Stop kidding yourself about XJT's completion percentage, sophistication of your network, quality of your pilots, etc. Bottom line is (unfortunately) your work is VERY replaceable by the lowest bidder. CAL will probably be smart and gradually introduce other regionals to the fold. They'll start off by offering them easily doable pieces of the XJT network; from CLE various short and mid-length hops in the midwest, a few cities from IAH around the SE and SW, and maybe some cities from EWR as well. They'll probably keep whomever is brought on board (Mesa? TSA? ) small at first but keep on handing off "your" cities to them. Those guys will be growing while you guys stagnate. And of course you'll be sitting there in your ERJ foolishly decrying whats happening but the fact is CAL can do whatever they want because THEY are the major and XJT is just a servant at the CAL house. Don't forget that son. That's a lesson we learned at ACA - what we thought of as "our" flying was gradually handed off to a smorgasboard of low-paying carriers (Mesa, Trans States, Shuttle America) while our growth hit the wall and we went backwards.
I have a great respect for the XJT pilot group, your route network that goes from Newfoundland to Mexico, from the West Coast to the Bahamas, but really the 'quality' product you offer CAL really won't factor too much into this equation. One of the things I thought UAL did right in the late 90s was they trimmed down their UEX flying into three operationally solid regionals; SkyWest, Air Wisconsin, and ACA. In this process they axed Mesa (for performance reasons) and reducing Great Lakes' status within the UEX program. I even clipped a Hemispheres editorial (UAL's inflight magazine) circa 2002 that has a UAL VP waxing on about how good the United Express carriers were. Fastforward through the UAL bankruptcy/cost-cutting era - In 2003, UAL put out tenders for UEX flying and literally the ONLY statistic that mattered was cost. It didn't matter that we at ACA knew the northeast like the back of our hand, had been doing the flying since '89, that we ran a pretty good operational ship. We trimmed our costs, attempted to resign with UAL but we could not match Mesa or Trans States' ridiculously cheap wage structure. Ultimately we tried Independence and are now a part of aviation history. Air Wisconsin took pay cuts, but weren't awarded growth opportunities within the new UEX family, had a bloody divorce and bought into USAir. Only Skywest remains, and thats because they took pay freezes at the time but also had the cheaper cost of business in Utah working for them. Some of the things that make XJT such a good place to be; pay, sophistication of equipment (you guys are CAT II certified), crew meals, other perks and work rules - they are expensive and will work against you in this process. I don't expect CAL to be as ruthless as UAL but the fact is Mesa or TSA or Pinnacle could probably do your work for less, so they will be invited on board.
Lastly it just makes sense for a major partner to diversity in their collection of regionals. You can whipsaw them one against another to keep costs in line, plus you also save yourself from the liability of having feed from only one source (reference the Comair strike of 2001, which essentially shut down Delta's CVG hub - you think CAL wants to put theselves in the poor position of having all their feed coming from one regional, and that any labor problems at the XJT end could screw them). It is inevitable - I don't meant to pop your bubble but I'm a realistic and somebody else is going to get a good chunk of those 69 RJs.
Now LRDRVR - CAL is not at all regretting their decisions regarding you - rather how they are rattling XJT's chains simply makes business sense for them. Lastly - don't get too optimistic about any XJT stand alone business plan. You guys may technically be a major, but don't kid yourself, the only way you did it was by clinging to CAL's coattails. Nobody knows the XJT company name, heck, you're lucky if they happen to notice the "Express" in Continental Express as they board the plane, since as far as the pax are concerned they are flying a CAL flight. Stop being delusional about you guys adding airframes or pursuing a separate business model. XJT is a virtual airline that specializes in providing cheap capacity for CAL. Relative to your peers in the regional industry, you guys are expensive, and that is why we won't see XJT cropping up also doing feeder flying for say NW or DL. Lastly - if you guys choose to go down the "Independence" road - good luck. Hopefully your management will learn from our example, which would probably entail starting whatever 'airline' you guys would become with a considerably reduced fleet, which would mean a pruning the current XJT workforce substantially.