Fallout from an age 60-Rule change

[lostplnetairman]

Conclusive studies have not been done yet.

Enough said!

 

[alaskaplt]

But again proof is in the flight deck every day we are out there. And again why would flying skills be exempt from aging. Besides the courts have already ruled the 60 rule is not discrimination. The rule stands at 60, so why would we need to prove anything to keep it.

Enough said!

 

[lostplnetairman]

Conclusive studies have not been done yet. But again proof is in the flight deck every day we are out there. And again why would flying skills be exempt from aging. Besides the courts have already ruled the 60 rule is not discrimination. The rule stands at 60, so why would we need to prove anything to keep it.

That was a very narrow ruling... again. let's see the proof--that's what it will take.

I don't have a stake in this--I just enjoy the banter!

HR Diva

 

[Echopapa]

Spooky, please spare us with your condascending know-it-all attitude. Not all of us "young guys" are young and dumb.

As always, it comes down to the have and have nots. From my point of view, the age 65 thing is a credible threat to not just an upgrade, but to my job. What happens to me and my family? Do I join the list of furloughed guys from (pick an airline) too?

It's pretty obvious that labor costs, whether right or wrong, is a focal point at every airline right now. If we add 5 more years to the top wage scale of the cost structure, what are the consequences in doing so? Let's look a simple cost analysis at my airline regarding retirements at 60 vs. 65:

5 year retirement outlook:
2005 = 69
2006 = 148
2007 = 159
2008 = 155
2009 = 134
Total = 665

Let's assume that 80% are widebody captains (WC) and 20% are narrow body captains (NC). We'll also assume that each captain has a 75 hr per month guarantee. 665 * .80 = 532 WC and 133 NC. We'll also assume that each captain is at the 15 year top of pay scale, so each WC currently makes $206.24 /hr and NC $177.78 /hr.

((75 hrs*206.24)*12 mos)*532 = $98,747,712 per year in salary.
((75 hrs*177.78)*12 mos)*133 = $21,280,266 per year in salary.

So each year it costs my airline $120,027,978 extra in labor costs, which would equate to $600,139,890 over a 5 year period. Also notice that this is just salary, not including insurance, medical costs, or anything else for that matter.

Let me preface this by saying that I would hate to see the age 60 rule change.....but...this is just bad math.

The only way the numbers change if the total numbers of FedEx WB or NB captains change. Generally, FedEx is going to pay a 59 Y/O WB Captain the same as they would pay a 63 Y/O WB Captain.

The rule change will have little effect on the total number of required Captains. If FedEx needs 1500 WB Captains before the rule change, they will need the number same after. So the net cost for all WB Captains remains unchanged. You math assumes that WB and NB Captains will be added to the fleet as a result of the change...thats is just wrong. Instead what will happen is all of us junior guys get to hang out in the junior seats for 5 years longer.....with little or no senority progression and much less hiring as there will be decreased attrition.

And as far as retirement, FedEx will probably save money. Consider this...we pay retirement until a pilot dies....which will not change if the retirement age changes. If the life expetancy is 70 (very optimistic) then right now FedEx pays for 10 years of retirment. After the rule change they now only have to pay for 5 years. Every airline with a defined benefit plan would benefit finacially (not safety) to force every pilot to fly until they die....that way no pension crisis because no pension costs....dead men don't collect checks.

Let me get out my crystal ball for some predictions....the same guys that are fighting to change the 60 rule will be fighting to change the 65 rule in five years. If their argument passes, which falls on age discrimination and passing a medical exam...then why set the number at 65? Why a number at all? They of course won't say this yet...just a little piece at a time.

Second prediction....If this rule passes we are all gonna pay the price with difficult new medical screening requirements. As the addage goes...be careful what you ask for..you just might get it. I think the FAA, who is very opposed to this action, will ensure safety by making the current fairly reasonable process to keep a medical certificate an overwhelming ordeal. Can you imagine a mental facilities tests every six months? Stress tests? Heart scans...you name it. Can you see some of those over sixty, over weight, smokers trying to run on a tread mill with a doctor watching.....yikes.

They already have different standards for class one medical certificates based on age...the EKG. You don't take one when your 20 but you sure do when your 50. The FAA can and will add a whole battery of tests at any age defined point if this rule changes.

 

[Flopgut]

Hey Flapgut or flopgut....

Do you know how to make paragraphs? Sure would make it easier to read your posts...

quote]


deleted. I was kidding. you're not a bad dude.

 

[Flopgut]

That was a very narrow ruling... again. let's see the proof--that's what it will take.

I don't have a stake in this--I just enjoy the banter!

HR Diva

Should it not be the burden of those who want to change the rule to prove it is not a safety concern? If it has a zero effect on safety then why does ICAO require one pilot be below 60?

Maybe you would consider answering a legal question? If they change the rule to ICAO standards could we FOs who are under 60 simply refuse to fly with CAs over 60? The rule suggest there is a concern for this arrangement. It seems the FOs are being expoited.

 

[Skyboss]

I can never understand this logic. At the current fare level we are MAKING A PROFIT. Perhaps your logic should be aimed at a carrier that is NOT making a profit, then maybe they will notice that if you charge $89 for a product that costs $100 to produce, you CAN'T MAKE A PROFIT.

You're only making that profit because you are hedged and most of your flights are short haul with higher yields in high density markets. Outside of fuel, your costs are the highest of any major carrier.

Here's a reality check for you. Your hedging is running out and you burn more fuel per passenger than any major carrier. Think about that for a second or two and come back to reality a bit and stop your bloviation about your company's ability to make a profit. No hedging = nightmare for Southwest.

 

[mnboyev]

Ahhh.... I love FlightInfo.... The banter continues....

SWA FO.... He's a good fella and a darn good pilot... leave him alone. Just a little high on company propaganda.

Age 65 will happen. Sorry everyone... Not sure what I think about it... I kinda think I would like to be done drooling on the beach by 60. But, hey ... If I feel good and the wife lets me keep working for a couple years...what the heck.

How bout them retired Delta guys coming back to fly...Whats that about ? Especially with guys on the street ?

 

[Jim Smyth]

You're only making that profit because you are hedged and most of your flights are short haul with higher yields in high density markets. Outside of fuel, your costs are the highest of any major carrier.

Here's a reality check for you. Your hedging is running out and you burn more fuel per passenger than any major carrier. Think about that for a second or two and come back to reality a bit and stop your bloviation about your company's ability to make a profit. No hedging = nightmare for Southwest.

Wow, You need to do your homework a little better. You couldnt be more wrong!

Yes, We are making a profit from hedging. Do you know what hedging is? Hedging is buying gas in advance with money thats in the bank. That money thats in the bank is "profit" dollars. Thats all goes into the formula and into the bottom line. This is what lets us keep our price where it is and lets us remain the low cost carrier. Also are average stage length every year is increasing so our costs fuel wise will continue to drop because of that. Our old average stage length used to be about 450 miles, its now up near 750 and increasing daily. Our costs are actualy not the highest, now where near it as a matter of fact. We are currently (today) in the middle of the pack as far as majors is concerned with costs to the company, excluding fuel.

Our hedgeing isnt running out! We are hedged until 08 right now and if we need more hedges we will go get them. As of January of 06 we the "ONLY" airline hedgd which will continue to increase our competative edge. Think about that for a minute! Now lets go to your senerio that all our hedges go away and oil goes to $80 a barrel. All we have to do is raise prices 10 percent to compansate, which will still keep us below the costs and ticket prices of the other airlines.

 

[ivauir]

You're only making that profit because you are hedged and most of your flights are short haul with higher yields in high density markets. Outside of fuel, your costs are the highest of any major carrier.

Nope, wrong again sparky. Out side of fuel our costs are the LOWEST (when adjusted for stage length) of any carrier. There are a couple LCC s getting close to us, and that is why we continue to put pressure on our costs.

Here's a reality check for you. Your hedging is running out and you burn more fuel per passenger than any major carrier. Think about that for a second or two and come back to reality a bit and stop your bloviation about your company's ability to make a profit. No hedging = nightmare for Southwest.

Here is a reality check for YOU. Our hedges will not be as good into the future as they are now, but they will be better than anyone else's. I guess you haven't been keeping up, but our stage length gets longer ever quarter, not just becase of fuel costs, but segment taxes and other expenses we do not control areon the rise.

Here is a FACT for you - last quarter our non fuel consts decreased, our fares increased AND our load factor went up. THAT is the reality. I don't want to get too much bloviatious for you, we know we are not bullet proof. Most of us know we have to watch our backs and that this environment is tough for everyone. But your analysis = opinion and wishfull thinking.

 

[SWA/FO]

You're only making that profit because you are hedged and most of your flights are short haul with higher yields in high density markets. Outside of fuel, your costs are the highest of any major carrier.
No hedging = nightmare for Southwest.

WRONG!


Hey flapout or flopout..... did I miss something?

Hey EV thanks for getting my back!!

 

[Flopgut]

WRONG!

Hey flapout or flopout..... did I miss something?

Yes. My post read: "Shhhhh... grown ups are talking".

Sorry, I'm going to quit being such an a$$hole.

 

[Skyboss]

WRONG!


Hey flapout or flopout..... did I miss something?

Hey EV thanks for getting my back!!

Then I guess we'll see what tune you're singing in a year.

 

[SWA/FO]

Ok Skyboss, thats a deal...we will meet back here on 11/28/06 and we will discus what?

What do you think is going to happen in a year? You think we will stop increasing our stage length? Do you think we will give up our hedges so we are no longer "cheating?" Will we stop buying airplanes? Will we close some cities, layoff thousands?

What are your predictions? Mark this date!! Please let us all know what you think is going to happen? Maybe then you'll have to call me by my new name "WN/CA"

 

[Jim Smyth]

Then I guess we'll see what tune you're singing in a year.

Its the same tune playing over and over, year after year.

 

[FurloughedTwice]

SWA/FO

Maybe then you'll have to call me by my new name "WN/CA"

Well, maybe then you can crack open a nice cold Bud Light "oh skipper of the sky" :beer:

 

[Jim Smyth]

1-2-3 Thank you.

 

[Spooky 1]

Ya, your right. I'm done.

Jim, you are wasting your intellegence on these guys. Give it up as nothing will change their minds.........or ours. Let the courts have their day and in time the pro 60+ pilots will prevail and the others will just quit when they turn 60. Not the end of the world in either case. Also, I seriously doubt that airplanes will start falling out of the sky inspite of so many dire predictions.

 

[81Horse]

Why would an airline that is making money want to cut pay & benefits and ruin a positive 34 + year relationship with its emplyoees? I personally don't think its going to happen... We would raise fares before any of this (your) doom and gloom would happen. We have pricing power, baby!!!

You're being facetious, right?

 

[SWA/FO]

Nope...I'm serious. PROFIT = making money. I see no paycuts in our future. Why would we need them?

 

[81Horse]

Nope...I'm serious. PROFIT = making money. I see no paycuts in our future. Why would we need them?

Because the entire playing field is being ratcheted down around you.

I'm not wishing you and your company ill -- but I've learned to take the long and cynical view of the industry and management. Management does not love you, SWA/FO; just sayin'.

 

[Jim Smyth]

Spooky 1, I am done and have said my peace with the 60/65 issue, I hope.

But I just hate to see some bad information spread around here from the arm chair quarterbacks that dont $hit about SWA or the industry in general.

Plus I suck at golf!

 

[737 Pylt]

Nope...I'm serious. PROFIT = making money. I see no paycuts in our future. Why would we need them?

You wouldn't, period! Your management team seems to have a grasp on the industry, and where its going. They know (based on their motto) to take care of employees, and they will take care of you, something the legacies have failed miserably at! The only problem I see with LUV is when/if the hedging comes up?!
737

 

[SWAdude]

You wouldn't, period! Your management team seems to have a grasp on the industry, and where its going. They know (based on their motto) to take care of employees, and they will take care of you, something the legacies have failed miserably at! The only problem I see with LUV is when/if the hedging comes up?!
737

I have posted this before and will again.

After reading this 737 Pylt, do you think our hedges are still a problem?

http://forums.flightinfo.com/showthread.php?t=66693

This paragraph alone sums it up:

"Competitors fares have increased to cover rapidly inflating fuel costs and have caused Southwest’s unit costs (or CASM) and unit revenue (or RASM) to become relatively lower than the competition. For example, from 2000 through 2Q 2002 Southwest’s unit costs averaged 40 percent below the major airline average, while unit revenue averaged 16 percent below. Over the past 24 months the relative level of Southwest’s unit costs has averaged 47 percent below the Majors, while unit revenues were 28 percent below. These huge unit cost and unit revenue gaps keep increasing, as the second quarter 2005 results show Southwest unit costs 65 percent below the major airline average and unit revenue 48 percent below. These gaps make Southwest more attractive to customers as Southwest fares fall further and further below other carriers. The increased unit cost gap is also interesting to investors as Southwest’s costs fall further below the competition, where industry CASM is now at an all time high pushing above 12 cents. Although fare adjustments relate directly to customer price sensitivity, which must be carefully watched, the fare “headroom” provided by competitors increasing fares allows a chance for Southwest to potentially pocket as much as $2 billion annually if it were to restore it’s historical relative fare gap of 16 percent below the competition (rather than the 28 percent below performance of the second quarter 2005)."

 

[737 Pylt]

I have posted this before and will again.

After reading this 737 Pylt, do you think our hedges are still a problem?

I guess not! The LUV model is perfect in every aspect...The only problem that might rear its ugly head is if SW goes for a different aircraft type. I will be interested to see how B6 does in the long term having introduced a new type of airplane!
737

 

[ivauir]

Then I guess we'll see what tune you're singing in a year.

Skyboss I cannot help but notice that you have no response to the fact that your information is grossly in error. We don't need to wait a year - you are out to lunch right now.

 

[lostplnetairman]

Should it not be the burden of those who want to change the rule to prove it is not a safety concern? If it has a zero effect on safety then why does ICAO require one pilot be below 60?

Maybe you would consider answering a legal question? If they change the rule to ICAO standards could we FOs who are under 60 simply refuse to fly with CAs over 60? The rule suggest there is a concern for this arrangement. It seems the FOs are being expoited.

Do you have a real name? (or one that is more acceptable in social circles)--it's really difficult to respond to "Flopgut" with a straight face! I'm sure you'll tell me it's some super secret aviation name! LOL!

I don't answer legal questions that request advice as that is not allowed.

No it's not my burden of proof. The ICAO requirement is a political issue to expediate passage of the rules. There are many, like you, who doubt the ability of those over 60 to function. Perception is 100% of the truth. So if there is tape on the passenger tray table, the whole plane is broken mythology applies! To get around that, they offer a mitigating solution that, while not based on fact, will get the job done politically.

But you should know that prior to now, medical science thought that the brain stops development at around age 20. Well Harvard has researched this, studying brains ranging from ages birth to 76. They focused on myelin, the insulation wrapped around the wires of nerve cells. Myelin affects how quickly you think, act, learn and process information. The study found that myelin increased dramatically in the fifth decade (33 percent) and more dramatically in the sixth decade ( 55 percent!). The later growth spurts all occurred in the part of the brain associated with emotional learning and memory, which may explain a lot about emotional maturity.

Until now, no studies have been done.

HR Diva

 

[crashpad]

F9s' contract allows retirees to retain their seniority rights and come back when the law changes, if they wish. I think that says a lot about how we look at pilots' assets based on experience instead of age.

Are there any other airlines working to slip this side letter into their contract?

 

[Skyboss]

Skyboss I cannot help but notice that you have no response to the fact that your information is grossly in error. We don't need to wait a year - you are out to lunch right now.

Keep on drinkin' the juice and chucking peanuts.

 

[QCappy]

Name one healthy (airline) company that has asked and gotten paycuts from its employees? None, most were near or in bankruptcy for that to happen. We would have to be near bankruptcy for this topic to come up and I don't see that happening.

Alaska